New Jersey Home Price Tracker – June 2008


(Click to Enlarge)

S&P Case Shiller Home Price Index – NY Metro Commutable

Low Tier (Under $332,377)
October 2006 – 259.75 (peak)
April 2007 – 255.94
April 2008 – 233.29
8.85% year over year decline
10.19% decline from peak

Mid Tier ($332,377 – $479,467)
September 2006 – 224.18 (peak)
April 2007 – 221.43
April 2008 – 200.83
9.30% year over year decline
10.42% decline from peak

High Tier (Over $479,467)
June 2006 – 193.24 (peak)
April 2007 – 188.57
April 2008 – 177.72
5.75% year over year decline
8.03% decline from peak

Aggregate Index
June 2006 – 215.83 (peak)
April 2007 – 211.61
April 2008 – 193.93
8.35% year over year decline
10.15% decline from peak

New Jersey Association of Realtors

New Jersey State Median Price
2006.Q3 – $385,200 (peak)
2007.Q1 – $361,300
2008.Q1 – $350,700
2.93% year over year decline
8.96% decline from peak
(seasonal effects come in to play here, this isn’t a valid comparison)

Source data: http://njrereport.com/files/NJ_home_prices.xls

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280 Responses to New Jersey Home Price Tracker – June 2008

  1. bairen says:

    First!

  2. bairen says:

    Looks like Wiley E has begun his plunge.

  3. BC Bob says:

    Somebody please place that wake up call to Richard. The market has met his 7%, decline, threshold.

  4. BC Bob says:

    How do the wizards dance on that slope?

  5. BC Bob says:

    Who is this guy, Mr.Speculator, that is wreaking havoc on all commodity markets?

    “SAN FRANCISCO (MarketWatch) — Cocoa futures rose to their highest level in at least 24 years Tuesday, as dry weather in major cocoa-producing countries cut global supplies. The price of the main ingredient of chocolate has doubled since the beginning of 2007.”

    http://www.marketwatch.com/news/story/cocoa-rises-historic-high-dry/story.aspx?guid=%7B4D00D0A7%2D8106%2D4DE1%2D8828%2D4CCF9283151A%7D

  6. kettle1 says:

    Damn it BC Bob, I thought bernanke and paulson told you to stop speculating and driving all these prices up needlessly!

    Do i need to call greenspan again? dont make him whip out the “irrational exuberance”.

  7. alia says:

    mutter mutter… (internal debate: do i run to costco and stock up on chocolate, or just move to a chocolate-producing country?… ;)

    clot, the list of countries that don’t extradite… how many grow cocoa and coffee?

  8. bairen says:

    #5 Messing with a man’s hot cocoa is just wrong. I’m going to track down mr Speculator and Ms Global Warming and straighten this out.

  9. Tom says:

    The xls file doesn’t load well in openoffice :(

  10. kettle1 says:

    Alia,

    Non extardition countires:

    Bangladesh
    Bosnia and Herzegovina
    Brunei
    Burkina Faso
    Burundi
    Cambodia
    Cameroon
    Cape Verde
    Central African Republic
    Chad
    China (People’s Republic of China)
    Union of the Comoros
    Democratic Republic of the Congo
    Cote d’ Ivoire
    Djibouti
    Equatorial Guinea
    Ethiopia
    Gabon
    Guinea
    Guinea-Bissau
    Indonesia
    Jordan
    Kuwait
    Laos
    Lebanon
    Libya
    Madagascar
    Maldives
    Mali
    Marshall Islands
    Mauritania
    Micronesia
    Moldova
    Mongolia
    Mozambique
    Myanmar
    Namibia
    Nepal
    Niger
    Oman
    Qatar
    Russian Federation
    Rwanda
    São Tomé and Príncipe
    Saudi Arabia
    Senegal
    Serbia and Montenegro
    Somalia
    Sudan
    Syria
    Togo
    Tunisia
    Uganda
    Vanuatu
    Vietnam
    Western Samoa
    Yemen
    and Zimbabwe.

  11. kettle1 says:

    ALia,

    Major cocoa producers:

    Benin
    Cameroon
    Congo, Republic of the
    Cote d’Ivoire
    Dominican Republic
    Ecuador
    Equatorial Guinea
    Ghana
    Grenada
    Haiti
    Liberia
    Nigeria
    Papua New Guinea
    Saint Lucia
    Sao Tome and Principe
    Sierra Leone
    Solomon Islands
    Togo
    Trinidad and Tobago
    Vanuatu

  12. kettle1 says:

    Alia,

    Major cocoa producers that are non-extradition countries:

    Cameroon
    Democratic Republic of the Congo
    Cote d’ Ivoire
    Equatorial Guinea
    São Tomé and Príncipe
    Togo
    Vanuatu

  13. kettle1 says:

    ALia,

    the major coffee producers:

    Brazil
    Vietnam
    Indonesia
    Colombia
    Mexico
    India
    Ethiopia
    Guatemala
    Honduras
    Uganda

  14. kettle1 says:

    ALia,

    unfortunately the major coffee producers and major cocoa producers do not intersect. I would recommend going to a non-extradition coffee producer such as Brazil, it is probably one of the safer options on the list

  15. kettle1 says:

    oh almost forgot….

    major coffee growers who are non-extradition

    Brazil
    Vietnam
    Uganda

  16. kettle1 says:

    does anyone realize that all sorts of government warning bells went off at the CIA/NSA/FBI….. between all the mentions of “non-extradition” and the various countries listed?

    Hey grim, you might see a small uptick in traffic for a day or so, its just the NSA

  17. njrebear says:

    grim,
    What’s included in NYC metro?

    Thanks!

  18. grim says:

    njrebear,

    From S&P:

    http://www2.standardandpoors.com/spf/pdf/index/SP_CS_Home_Price_Indices_Methodology_Web.pdf

    Note: the S&P/CS® New York City Home Price Index is not an MSA. It represents a
    customized metro area that measures single-family home values in select New York,
    New Jersey and Connecticut counties with significant populations that commonly
    commute to New York City for employment purposes.

  19. skep-tic says:

    I wish all of the realtors who preach about it being impossible to market time real estate would take a look at this chart.

  20. skep-tic says:

    A hint: real estate prices were basically flat for five years following the last downturn.

  21. skep-tic says:

    Forgot to thank Grim for the great information. Great job as always

  22. njrebear says:

    boomers crashing!

    http://www.cepr.net/documents/publications/housing_crash_baby_boomers_2008_06.pdf

    …household’s [45-54] wealth may decline to $81K in 2009, from $150,113 in 2004.

  23. BC Bob says:

    kettle [6],

    It baffles me when I look at the prices of cobalt, chronium, rhenium, molybdenum, etc.. Now, these do not trade on an exchange. If speculators are not involved in the trade, why are these at record price levels? Could the wizards be misleading us, blaming the run up in prices, exchange listed, on the specs? No, stupid thought. Even they wouldn’t attempt something so asinine like that?

  24. kettle1 says:

    BC Bob,23

    that is why i thin we are about to see the Katrina of economics.

    http://farm1.static.flickr.com/143/357282774_1fcace204b_o.jpg

    who’s got the hienies???

  25. gryffindor says:

    Our newbies came by during their orientation at work today. One guy is married with a kid under the age of 3 and with another one on the way. He will only be in the area for 3 years (the max contract our department), and told us they bought a house 35 minutes away because his wife demanded 4 BR and a pool and our puny salaries led them to the town so far away. The poor guy will be cursing that commute when he has to be here early and stay late his first year and buying gas for the commute.

    What exactly do you do with 4 BR and a pool when your 2 kids are under the age of 3?

  26. PGC says:

    #23 BC Bob

    I posted a link on this a few weeks back. The main issue is that demand from China, outstripped demand. There are rumors that they have sufficient stockpiles and demand is dropping as the global recession starts. A major correction is coming.

  27. Firestormik says:

    My commute is ~1:15 door to door. (Walking->Train->Walking). You get used to it in time.

  28. alia says:

    kettle: stockpiling chocolate it is, then. we’ll ship it slow freight to brazil…

    ;>

  29. PQG says:

    Princeton’s Burst Bubble

    The headline is misleading. The interviewee sez that Princeton’s not doing so bad.

    http://cosmos.bcst.yahoo.com/up/player/popup/?rn=289004&cl=8500931&src=finance&ch=1316259

  30. njpatient says:

    “when he has to be here early and stay late his first year ”

    gryff – you only make him show early and stay late his first year?

  31. PQG says:

    In the link above, the “Princeton’s Burst Bubble” video should be below the one that actually comes up.

    You can also go to Fox Business News and find it in their video section.

  32. chicagofinance says:

    BC Bob Says:
    June 24th, 2008 at 7:45 pm
    Who is this guy, Mr.Speculator, that is wreaking havoc on all commodity markets?
    “SAN FRANCISCO (MarketWatch) — Cocoa futures rose to their highest level in at least 24 years Tuesday

    Bost: I know Covelli Crisp is the CF for the Red Sox. Is Cocoa Futures the guy the Giants called up from AAA Fresno to take the place of Bonds?

  33. chicagofinance says:

    gryffindor Says:
    June 24th, 2008 at 9:18 pm
    What exactly do you do with 4 BR and a pool when your 2 kids are under the age of 3?

    gf: pay higher homeowners insurance…..

  34. skep-tic says:

    #25

    “35 minutes away”

    That commute sounds pretty good to me

  35. skep-tic says:

    #25
    “What exactly do you do with 4 BR and a pool when your 2 kids are under the age of 3?”

    Ask Jerry Lee

  36. Hard Place says:

    njrebear,

    I was reading that article you posted and stopped and had to paste this excerpt for all to see.

    Finally, the projections show that the renters within the same wealth quintiles in 2004 will have more wealth in 2009 than homeowners in all three scenarios. In the second and third scenarios, the renters
    will have dramatically more wealth in 2009 than the homeowners who started in the same wealth quintile. Homeownership is not everywhere and always an effective way to accumulate wealth. For those who owned a home in the last few years, the collapse of the housing bubble led to the destruction
    of much or all of their wealth.

    CHEW ON THAT RE BULLS

  37. J says:

    I am an infrequent poster, but knew you all would get a kick out of this “sign of the times…”

    $175 Per Entry *****TAKE A CHANCE AND WIN***** 3br House

    http://philadelphia.craigslist.org/rfs/730911215.html

  38. rhymingrealtor says:

    Ask Jerry Lee

    Or OJ, or Tommy Lee

  39. skep-tic says:

    No wonder people with pools pay such high insurance rates.

  40. Mikeinwaiting says:

    J 38 is that legal?

  41. skep-tic says:

    #22

    this is why I think we are seeing so many older sellers unwilling to cut prices despite having owned their homes for many years. their entire retirement plan is contingent on a windfall from selling their house

  42. Outofstater says:

    #22Boomer Crash. Scary stuff. It mirrors a conversation I had with an early boomer. House in nice suburb of Detroit (yes, there are some) has dropped 38% in value. Her 800plus credit score wasn’t enough to get a HEL so she re-fi’ed last month. Didn’t have the heart to ask why she re-fi’ed because I know the answer – to pay her everyday bills AND a 60K kitchen makeover. And this is someone I always thought was good with money – do people just go insane when it’s real estate?

  43. skep-tic says:

    from the link at #22

    “The plunge in wealth that most families are projected to see as a result of the collapse of the housing bubble should emphasize once again the potential danger of such bubbles. There are two reasons that
    these families see sharp declines in their wealth over this period. The most obvious reason is the loss in the real value of their home, their major financial asset.

    “However, there is a second important factor that also leads to a decline in wealth for this age cohort between 2004 and 2009. As a result of the bubble-inflated values of their homes, tens of millions of families opted not to save during what would typically be their peak saving years.”

  44. Mikeinwaiting says:

    Guess who will be paying for all these boomers in their old age guys. You. As the biggest voting block they wiil be taken care of on the backs of you youngsters. Sorry, from a boomer.

  45. Hard Place says:

    A nice conclusion to that CEPR article.

    Finally, these projections should make clear that homeownership is not always an effective way to accumulate wealth. Homeownership in a housing bubble was a route toward losing wealth, not accumulating wealth. While typical homeowners cannot be blamed for not recognizing the bubble, the
    economists and policy professionals who designed policies that pushed homeownership certainly can and should be blamed.

    In other words… It’s all George Bush’s fault.

  46. Mikeinwaiting says:

    46 And everyone went along for the ride. We can’t give Bush all the credit on this one.

  47. gryffindor says:

    We are residents in a medical center, hence the puny pay. Our first year is the most work. The third and final year is the least work which I get to start next week, yay. Thirty five minute commutes are normal in NJ, but it is not necessary to have such a long commute in Nashville. Good school districts are found less than 15 minutes away. This guy will likely move back to his home state after his 3 years here. He bought a home in marginal school district far away just so his wife could have the 4th bedroom and pool. He could have bought or rented a smaller home with no pool (or large apartment with pool in the complex) less than 10 minutes away in the city with an equally poor school district. Although with kids so small, school district isn’t going to matter for him by the time he leaves. I don’t even know what deals the other two married newbies bought, I’m sure I’ll find out soon. The lone single guy is renting an apartment in walking distance.

    Buying homes as poorly paid residents is fashionable in Nashville, probably because the homes/townhomes/condos can still be affordable and desirable compared to the housing stock I’ve seen in NJ. Flipping them for profit was equally as cool, although 2007’s graduates didn’t see as much of a flip profit as they anticipated. My colleagues are starting to sweat a bit as they start thinking about selling in a year. I will hand my keys to the leasing office and drive my Civic back to NJ.

  48. jmacdaddio says:

    The Star-Ledger is running a story on tactics used to delay foreclosure proceedings – basically, the “who owns the mortgage note” trick. I think it’s a matter of time before banks get their act together and set up a foreclosure collection clearinghouse. In the end the banks always win.

    http://www.nj.com/news/index.ssf/2008/06/new_tactic_slows_rate_of_forfe.html

  49. Clotpoll says:

    alia (7)-

    Indonesia.

  50. Clotpoll says:

    BC (23)-

    Seen the price of salt lately?

  51. skep-tic says:

    #48

    Do you notice that doctors and lawyers (I am a lawyer) seem to feel as though they should be rich and often try to affect a lifestyle as if they are rich, even though in our current society, these professions generally are not so well off (esp considering the mountainous education debt).

    I notice this all the time and I find it very odd. It is as if these people, who are otherwise smart, can’t accept this obvious fact staring them in the face. A good example, maybe, is your colleague and his wife who pretend to live the life of a rich doctor

  52. jmacdaddio says:

    A surprising number of doctors and lawyers go broke because of the lifestyle expectations. It takes years to recoup the education expense, get established, and start living the life. I’m glad that I can show up at work in khakis and a polo shirt designed by someone not named Armani.

    Interestingly interest-only loans were generally used for people like medical residents or recent law grads who are both sure bets to make more money in the future. These loans were never meant to help Frankie the Tow Truck Driver and Alice the Part Time Medical Biller (you know, part time ’cause of the kids) pay 550k for a POS Cape Cod in Old Bridge.

  53. skep-tic says:

    leaving work now. zombie time

  54. grim says:

    From the Philly Inquirer:

    Faith in economy lowest in 16 years

    Americans’ confidence in the economy fell this month to its lowest since the early 1990s under the weight of the long housing slump, a sluggish job market, and rising prices, especially for gasoline.
    The Conference Board said yesterday that its consumer confidence index dropped nationally to 50.4, the lowest since February 1992. The level was 58.1 in May.

    “From a consumer perspective, this is the most troubling economy since the 1980s,” said Mark Vitner, an economist at Wachovia Corp.

    In the Middle Atlantic states – Pennsylvania, New Jersey and New York – the June confidence index fell to 39.3 from 45.4. The June level was the worst since August 1993.

    “In the Middle Atlantic region, the financial sector makes up a large portion of the economy – and as we well know, there has been a lot of turmoil in that area for several months,” said Lynn Franco, director of the Conference Board’s Consumer Research Center.

    She said the region’s continuing loss of manufacturing jobs also was contributing to the generally bleak atmosphere in the region.

  55. grim says:

    From the WSJ:

    Illinois Plans to Sue
    Countrywide, CEO
    By RUTH SIMON
    June 25, 2008; Page A12

    The Illinois attorney general’s office, which began an investigation into the business practices of Countrywide Financial Corp. last fall, says it has found enough evidence of wrongdoing that it plans to file a civil suit against the mortgage lender and its chief executive, Angelo Mozilo.

    The suit is expected to be filed Wednesday.

    In a draft of the complaint, Illinois alleges that the company engaged in “unfair and deceptive practices” in the sale of mortgage loans. The 78-page document says the company loosened its underwriting standards, structured loans with “risky features” and engaged in “marketing and sales techniques” that incentivized employees and mortgage brokers to push loans whether or not homeowners had the ability to repay them.

    The complaint says the company’s actions were driven by its desire to boost market share and to satisfy Wall Street’s appetite for mortgage securities. “Investor demand and secondary market valuation…became the primary concern when determining what kinds of loans to market and sell and at what price, rather than the consumers’ ability to repay the loans,” said the complaint.

  56. grim says:

    From the APP:

    Towns buckling with aid cuts

    The adjustments to the newly approved state budget included in the appropriations bills demonstrate the initial state proposal to slash municipal property tax relief funding by $189 million was unwise, unfair and unreasonable.

    Therefore, we salute Gov. Corzine and legislative leadership for agreeing to lighten the impact of these cuts on local property taxpayers all around the state.

    Still, based on our analysis of the proposed changes, local policymakers all around the state will need to account for the loss of about $154 million in municipal property tax relief funding. And, inevitably, so will our property taxpayers.

    Against the backdrop of the slumping national economy, many of them already are buckling under the burden of rising costs and flattening incomes. And all of them are paying property taxes well above the national average.

  57. grim says:

    From the Star Ledger:

    Lawyers’ tactic slows rate of forfeited houses in New Jersey

    Most home foreclosures being processed in New Jersey are illegal, a growing group of attorneys contends, because lending institutions cannot prove they own the debt they are trying to collect.

    Judges in at least four New Jersey counties already have halted foreclosures, using a federal court ruling in Ohio as precedent. And with 48,000 foreclosures expected to be filed this year — twice the number filed in 2006 — some attorneys believe challenging foreclosures can become a large and potentially lucrative area of practice.

    “This is starting to creep up all over the state and all over the country as people start to realize these banks don’t really know who owns the (promissory) note,” said Peggy Jurow, a senior attorney at Legal Services of New Jersey, which is teaching lawyers how to represent pro bono clients in these cases. “It’s scary to think how many people are losing their homes who shouldn’t be.”

    Attorneys for the lending institutions say this wave of challenges is built on nothing more than legal technicalities and banks quickly will regain their footing.

    “These lawyers are trying to grasp on the smallest legal issue, and they’re losing sight of the justice involved,” said Ralph Casale, a Denville-based attorney who has represented lenders in foreclosure for more than 30 years. “It comes down to this: Were you given the loan? Have you paid it? If you haven’t paid it, doesn’t the person who loaned you the money have the right to collect?”

  58. grim says:

    From the Washington Post:

    Vital Part of Housing Bill Is Brainchild of Banks

    A key provision of the housing bill now awaiting action in the Senate — and widely touted as offering a lifeline to distressed homeowners — was initially suggested to Congress by lobbyists for major banks facing their own huge losses from the subprime mortgage crisis, according to congressional staff members and bank officials.

    Credit Suisse, a large investment bank heavily invested in mortgage-backed securities, proposed allowing hundreds of thousands of homeowners to refinance their mortgages with lower-cost government-insured loans, relieving financial institutions of the troubled debt.

    After the bank proposed this to Congress in January, it became known as the “Credit Suisse plan” among congressional staffers and lobbyists. It later formed the basis of housing provisions in both the House and Senate.

    Bank of America, which is acquiring Countrywide Financial, the country’s largest mortgage lender, followed with a similar and more detailed proposal, principal negotiators on the legislation said.

  59. njpatient says:

    This is going to be a long day

  60. grim says:

    From Bloomberg:

    New-Home Sales in U.S. Probably Fell in May, Extending Slump

    Sales of new houses in the U.S. probably fell in May to the second-lowest level in almost 17 years, signaling the housing slump will keep weighing on the economy, economists said before a report today.

    New-home purchases declined to a 512,000 annual rate, according to the median estimate of 73 forecasts in a Bloomberg News survey, from a 526,000 pace in April. A separate report may show demand for durable goods stalled last month.

    Falling property values, rising mortgage rates and stricter borrowing rules may keep potential buyers out of the market for much of 2008. Even as declines in housing hurt growth, Federal Reserve policy makers are forecast to keep the benchmark interest rate unchanged today on concern Americans are losing confidence that inflation will stabilize.

    “It’s still a pretty dismal picture in terms of housing demand,” said Michael Gregory, a senior economist at BMO Capital Markets in Toronto. “Inventory levels remain very, very high and that suggests you have to have more adjustment.”

    The Commerce Department is scheduled to release its new- home sales report at 10 a.m. in Washington. Estimates ranged from 480,000 to 570,000.

  61. grim says:

    From the NY Times:

    Approval Is Near for Bill to Help U.S. Homeowners

    With sinking home values continuing to drag down the economy, Congress is poised to approve a huge package of housing legislation, including a refinancing program aimed at rescuing hundreds of thousands of homeowners in danger of foreclosure and the most sweeping government overhaul of mortgage financing since the New Deal.

    Lawmakers moved with increasing urgency on Tuesday after a closely watched housing index showed prices nationally had declined in April by more than 15 percent from a year earlier. Senator Harry Reid of Nevada, the majority leader, threatened to keep the Senate in session through the Fourth of July holiday to finish the housing measure, if needed. The House has already approved similar legislation.

    The centerpiece of the Senate package is a rescue-refinancing plan aimed at stemming the tide of more than 8,000 new foreclosures a day that lenders are filing across the country. The plan would allow distressed borrowers and their lenders to stem losses by allowing qualified owners to refinance into more affordable, 30-year fixed-rate loans with a federal guarantee.

    The legislation would also provide benefits for first-time buyers, who would receive a refundable tax credit of up to $8,000, or 10 percent of the value of a home, on purchases of unoccupied housing.

    As part of a regulatory overhaul of Fannie Mae and Freddie Mac, the mortgage finance giants, the bill would permanently increase to $625,000, from $417,000, the limit on loans they can purchase from lenders in expensive housing markets, making it easier for borrowers to obtain mortgages at discounted rates. Despite a presidential veto threat, the package received overwhelming bipartisan support, clearing by 83 to 9 a crucial procedural vote in the Senate on Tuesday morning.

  62. grim says:

    From MarketWatch:

    Trichet doubts speculation is major culprit in oil rise

    Speculation doesn’t appear to be playing a primary role in rising oil and commodity prices, although a reallocation of global portfolios toward commodities may be one of several factors, European Central Bank President Jean-Claude Trichet said in a European Parliament hearing Wednesday. “I’m not sure speculation is the major culprit,” Trichet said, adding that supply and demand concerns remain the “major issues.” Trichet said it “very important” that oil producers follow through on pledges to boost supplies, as well as for users to conserve oil “where possible.”

  63. bairen says:

    There are 10 million millionaires in the world, 3 million in the US.

    http://www.cnn.com/2008/US/06/24/world.wealth.ap/index.html

    I guess not everyone North of the Driscoll bridge is a milionaire. Although many posers do live the lifestyle.

    So much for Pret’s sea of wealth from Virginia to Boston. If all the millionaires in the US lived in that corridor, less then 5% of the corridor’s population would be a millionaire.

  64. bairen says:

    #64 I got the state’s population figures from
    http://en.wikipedia.org/wiki/List_of_U.S._states_by_population

  65. grim says:

    From MarketWatch:

    Mortgage applications down 9.3% last week: MBA

    Applications for mortgages fell again last week, with volume down a seasonally adjusted 9.3% compared with the week before, the Mortgage Bankers Association said Wednesday.

    Both refinancings and applications for mortgages to purchase homes were down for the week ended June 20, even as mortgage interest rates decreased from the prior week, according to the MBA’s weekly survey.

    Overall, applications were down 25.3% compared with the same week in 2007.

    Applications to refinance existing mortgages decreased 12.1% on a week-to-week basis, while filings for mortgages to buy homes fell a seasonally adjusted 7.4%, according to the survey.

  66. Confused In NJ says:

    45.Mikeinwaiting Says:
    June 24th, 2008 at 10:44 pm
    Guess who will be paying for all these boomers in their old age guys. You. As the biggest voting block they wiil be taken care of on the backs of you youngsters. Sorry, from a boomer.

    The Boomers won’t be paid for, rather they will be converted into Soylent Green to feed the masses of illegals. Sorry, Greatest Generation.

  67. grim says:

    From CNBC:

    Mortgage Applications Drop to 6-1/2-Year Low

    U.S. mortgage applications fell for a second consecutive week, hitting their lowest level in nearly 6-1/2 years despite a sharp drop in interest rates, an industry group said Wednesday.

    The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications for the week ended June 20, which includes both purchase and refinance loans, dropped 9.3 percent to 461.3 — the lowest level since the week ended Dec. 28, 2001.

    The report offers additional evidence of a U.S. housing market that is suffering one of the worst downturns in its history.

    Significantly tighter lending standards and an unwieldy supply of homes for sale are some of the factors preventing the U.S. housing market from rebounding out of its two-year-long slump.

    The frenzy of foreclosures hitting the market is aggravating matters adding to the supply of unsold homes and depressing home prices nationwide, analysts say.

  68. bairen says:

    #64 & #65 Now if I could find those articles and figure out the data in about 2 minutes, how come the “sophisticated investors” buying MBS pools didn’t realize housing was way overpriced in comparison to income and wealth? Why are the talking heads and politicians so shocked by this bust?

    Why were “sophisticated investors” buying subprime pools rated AAA (subprime AAA is a favorite oxymoron of mine)? How is putting a thousand mortgages from dead beats into a pool AAA worthy?

    Probably because the whole system is a big con. Smoke and mirrors. A farce. Get your commissions, bonuses, stock options, and votes. Who cares what happens 3 years from now, we will just socialize all losses and blame speculators and sovereign funds for our demise.

  69. bairen says:

    #45 mikeinwaiting,

    Sorry, ain’t going to happen. Wal-mart will simply expand to 2 million stores so your fellow boomers will find jobs as greeters and carriage boys.

  70. thatBIGwindow says:

    I think people use “good school systems” to compensate for being lousy parents

  71. Essex says:

    BigWindow…that ‘is’ interesting. I like that.

  72. Essex says:

    My thought is that you want your child to be safe…you want the school to provide a consistent environment. To know if your system is a good one, you really need to have a very good communication with your child and know if they can read and add…and know history. Etc.

  73. Essex says:

    Oh, and are they happy and well adjusted….I mean hey….most parents are not…but childhood should be different. Right?

  74. thatBIGwindow says:

    The towns with “good/excellent schools” is a sham on the taxpayer. Case in point: I know people who went to high schools in towns like:

    Clifton
    Bergenfield
    Dumont
    Hackensack (Maywood)

    And guess what? They are all doing well for themselves. In addition, I went to a very good “blue ribbon” high school and my wife went to a “marginal” high school. Guess who has their masters from Rutgers and who doesn’t?

    Parenting > Schools.

    “My thought is that you want your child to be safe…you want the school to provide a consistent environment. To know if your system is a good one”

    my thoughts exactly Essex!

  75. bairen says:

    How can the boomers live out their golden years on golf courses and in fine restaurants, even though they failed to save and led a life of conspicuous consumption?

    They will become caddies and busboys. The boomers will compete with illegal aliens for the various menial jobs, thus helping to keep wage inflation in check.

  76. BC Bob says:

    bairen [69],

    Exactly.

    You will always have your Blodgett’s, Quattrone’s, Grunman’s and Cioffi’s. That said, these “sophisticated” investors have to get a grip. Time for them to acknowledge that they f*cked up. Stop blaming others. Take a long hard look in the mirror.

    Anyone with a pulse, not many, knew this market was set up for a bust. In addition to that, subprime never had a chance. Yet these dolts are invested in a high grade structued credit fund and an enhanced structured credit leverage fund? What about their due diligence? Suck it up and move on. Next time open the damn prospectus and at least read the first paragraph.

  77. bairen says:

    #70 BC Bob,

    Love the graph. San Fran may actually be reasonable at the 2010 price. The SF trough price in Nov 2010 would have bought a pos cape in North Jersey at the peak.

  78. BC Bob says:

    “The boomers will compete with illegal aliens”

    bairen,

    I was planning to be a shoe shine man, outside the NYSE. Trade on the info. Well, Broad And Wall is barren,[not bairen]. I guess I’m going east, Dubai Bob.

  79. grim says:

    Next time open the damn prospectus and at least read the first paragraph.

    Yeah, maybe, but those fund names were just so clever. (Credit to Fortune and Bird)

  80. njpatient says:

    52 skep/53 jmac
    “It takes years to recoup the education expense”

    That’s why the personal finance book I write will be titled “Getting to Zero”.

    The prologue will be about how I was walking down 6th Avenue a couple of years out of law school when I was accosted by a bum with a coffee cup asking me for money. I looked at the bum and thought to myself: “I can’t wait until my net worth is as high as his!”

  81. bairen says:

    #80 BC Bob,

    Shoeshine boy and caddy are 2 jobs I don’t think can be off shored. They are our new growth industry.

    Go to Singapore instead BC. Much better food and health care.

  82. thatBIGwindow says:

    My mother is an early boomer. She only invested in CD’s and conservative mutual funds. Basically, she lives like her parents lived. Spend a little, save a little. Now she is retired and bored.

  83. njpatient says:

    69 bairen

    “Get your commissions, bonuses, stock options, and votes. Who cares what happens 3 years from now”

    Now you’re paying attention…

  84. BC Bob says:

    “TOKYO: Heavy selling hit shares in Japanese property firms on Wednesday after real estate developer Suruga Corp fell into bankruptcy, fanning fears about the health of a sector hurting after the global credit crunch.”

    “Suruga’s bankruptcy comes as the global credit crisis muddies the outlook for Japan’s once-soaring property market. The Tokyo Stock Exchange’s REIT index has fallen about a quarter this year and nearly halved in value since a peak last May.”

    http://economictimes.indiatimes.com/International_Business/Japan_property_stocks_slide_after_firm_goes_bankrupt/articleshow/3162663.cms

  85. HEHEHE says:

    BC,

    I’ve caught they caught the cocoa speculator:

    http://i26.photobucket.com/albums/c109/El_Ian/cocopuffs.jpg

  86. grim says:

    He looks awfully similar to that shifty roadrunner fellow.

  87. grim says:

    From MarketWatch:

    Small banks could take construction loan hit

    Small banks could be greatly exposed to billions of dollars of outstanding construction loans to home builders and developers, a published report said Wednesday.

    Small banks have some $280 billion of outstanding construction loans and analysts have predicted that as many as 150 smaller banks could fail in coming years after betting heavily on construction loans, The Wall Street Journal reported.

    The practice of allowing real estate developers to delay paying construction-loan interest has raised alarms with regulators concerned that smaller banks are masking potential problem loans, the paper said.

  88. BC Bob says:

    he [87],

    Top notch.

  89. grim says:

    No love for Count Chocula?

  90. John says:

    Because of the economic slowdown, the wealthy tended to shift their money to safer investments such as bonds and money-market savings accounts, and away from less stable investments such as real estate, the report found.

    So the wealthy view real estate as an unstable investment. Well I guess the realtors still have the poor as customers, I guess they buy a lot of houses.

  91. frank says:

    “Approval Is Near for Bill to Help U.S. Homeowners ”

    It’s about time the Democrats do something about housing. Republicans just put their head into the sand and hope things will go away.

  92. grim says:

    They got the headline wrong, it was supposed to read:

    “Approval Is Near for Bill to Help Bank of America and Credit Suisse”

  93. thatBIGwindow says:

    Wrong, it was really supposed to read:

    “Approval Is Near for Bill to Help Bank of America and Credit Suisse and screw the middle class”

  94. HEHEHE says:

    Count Chocula was given immunity, turns out he used to work at Goldman and was a member of Skulls & Bones.

  95. frank says:

    At least this bill will help American taxpayers and American companies as opposed to Iraq or Afghanistan and the price tag will only be 10% of the cost of the war. How can anyone oppose it?

  96. John says:

    I love Wamu. You can’t have 13% plus yields for too long without fixing the problem or going broke. If I believe in Wamu, why I am I going to subscribe to their new cash offering when I can get 13% on an existing bond. So is Wamu going to go for 14% at their next trip to the well?

    WASHINGTON MUT INC SUB NT 8.25000% 4/01/2010
    Price (Ask) 92.670
    Yield to Maturity 13.041042%

  97. thatBIGwindow says:

    Yeah, I am all for feel good legislation.

  98. BC Bob says:

    95, Yes
    96, Yes
    98, I guess it sucks buying at the peak.

  99. HEHEHE says:

    BC,

    Nice pic

  100. 3b says:

    #46 Hardplace: Anyone could have recognized it was a bubble, including the homeowners.

  101. grim says:

    Herring for breakfast?

  102. lostinny says:

    Grim
    Count Chocula is mah hommie.
    Alia, I might meet you if you pick a major chocolate producing country. :)

  103. grim says:

    I can’t quite pinpoint why, but the Count reminds me of Ara Hovnanian.

  104. lostinny says:

    Grim
    Is it the hair?

  105. thatBIGwindow says:

    Angelo Mozilo reminds me of beef jerky. I shouldnt say that, he is my brother in laws cousin…

  106. lostinny says:

    Anyone notice the similarity between Guiliani and Nosferatu?

  107. 3b says:

    #108tbw; Nice, cutting on your brother in laws cousin, and knocking River Dell.

  108. thatBIGwindow says:

    …I know, I have no respect :(

  109. bairen says:

    #98 frank

    Very easily. I will only support it if it also gives huge amounts of money for us renters who refused to take part in this housing pyramid scheme or home owners who refused to trade up during the frenzy. We should be rewarded for our fiscal prudence, instead we will be punished and stuck footing the bill for the financially illeterate AKA the General Public.

  110. frank says:

    #112,
    Risk takers get rewarded; fiscal prudence will get you nowhere.

  111. thatBIGwindow says:

    What about me? What if I lose my job and can’t pay my conventional 20% down 30Y Fixed mortgage? Who is going to help me? Is the IO/ARM/100% financing crowd more worthy?

  112. hughesrep says:

    114

    Buy your own Senator.

  113. John says:

    Re 114, just have an affair with a gov and sell your downloadable songs for a few hundred thou. Or have an affair with Christie Brinkly’s husband and get paid a few hundred thou not to talk to the media.

    All the hookers are back at their day jobs not that RE is dead and even renters can join in. America is a great country.

  114. frank says:

    #114,
    Joke on you, you should have taken a subprime IO with no money down. I always said that the smartest people take mortgages with no money down, they have nothing to loose. It’s like going to AC with banks money. I love it.

  115. 3b says:

    #177 John: and they keep cutting aid to the the state universities.

  116. bairen says:

    #113 frank,

    I’ll stick to Buffet and Munger. They’ve done pretty well being fiscally prudent.

  117. bairen says:

    #114 tbw

    According to frank you were fiscally prudent and will go nowhere. The NINJA ZERO down crew were risk takers and should be rewarded.

  118. frank says:

    “and they keep cutting aid to the the state universities.”

    Who needs state universities, we get them educated from India and China, why pay for the education when you can get it for free?

  119. SG says:


    Hard knock night for Assembly Democrats still adds up to GOP heartache

    As he stood with futility against a bill he believes would ravage his 39th Legislative District, Assemblyman John Rooney took little joy in noting a personal milestone.

    For while 2008 marks the Bergen County Republican’s 25th anniversary as an assemblyman, it is also the low point of his legislative career.

    “My towns got destroyed last night,” said Rooney, a day after the majority Democrats passed a $32.9 billion budget, which includes 25% cuts in aid to all of the 28 municipalities in Rooney’s district, and eliminations of property tax rebates for residents in the $150,000 to $250,000 income range.

    Monday also brought the Democrats’ successful if ignominious – by Rooney’s reckoning – passage of a bill requiring the construction of affordable housing in affluent towns.

    “It’s just a plan to get more Democratic voters in our towns,” complained the veteran Republican assemblyman, whose home of Northvale for years took advantage of state regional contribution agreements that enabled small municipalities like his to sell their Council on Affordable Housing (COAH) obligations to places like Newark and Jersey City.

  120. Anon E. Moose says:

    Circling the drain!!! WOOF! WOOF!

  121. BC Bob says:

    “Risk takers get rewarded; fiscal prudence will get you nowhere.”

    Frank,

    Somewhere, PT Barnum is spinning.

    Only prudent risk takers get rewarded, the reckless become a statistic.

  122. SG says:


    End of RCAs Could Devastate Middletown with New Construction

    Two recently introduced bills working their way through the state legislature will have dire consequences for Middletown and other towns like it if they are ultimately signed into law. Bills A500 and S1783 would effectively end the option of Regional Contribution Agreements (RCAs), which allows towns to satisfy a portion of their state-mandated low income housing quota by rehabilitating existing housing in surrounding towns. If this did come to pass, it would mean that Middletown would have to build its hundreds of additional low income units within its borders. Since the COAH formula states that for every four units of market rate housing, one low income housing unit must be built, that could mean thousands of new housing units must be built in Middletown in order to satisfy the state’s demands. Simply put, this would change the character of our town forever and result in severely overcrowded schools, congested roads and overwhelmed municipal services.

  123. grim says:

    Bills A500 and S1783 would effectively end the option of Regional Contribution Agreements (RCAs), which allows towns to satisfy a portion of their state-mandated low income housing quota by rehabilitating existing housing in surrounding towns.

    SG,

    Hard not to take issue with this, RCAs have nothing to do with “surrounding” towns at all. Note the article above that said that Northvale sold its obligations to Newark and Jersey City. How, exactly, are those “surrounding towns”?

  124. Herring123 says:

    Count Chocula was based on bela lugosi (I think the lugosi estate sued the cereal maker for infringing upon his right of celebrity/right of publicity) and the resemblance between lugosi and ara hovnanian is pretty strong.

  125. bairen says:

    #126 COAH will only succeed at making all of NJ a dump.

  126. gary says:

    Hovnanian and Dracula have so much in common regardless of similarities in appearance; they’re both blood-sucking parasites who need an endless supply of victims or they’ll wither up and die.

  127. SG says:

    That article is written by Gerry Scharfenberger, Mayor Middletown Township. Its natural for him to argue against abolition of RCA.

    # bairen Says:
    #126 COAH will only succeed at making all of NJ a dump.

    You got it confused. COAH is just following NJ Supreme court decision which was followed up by legislation. You can’t blame agency for following its charter. The issue is not COAH, the issue is Rich towns using Zoning ordinances to prevent any housing.

  128. HEHEHE says:

    “I think the mortgage industry has done more to hurt this country than al-Qaeda ever did,” Subers said.

    http://www.bloomberg.com/apps/news?pid=20601087&sid=a8C74i7bBnh0&refer=home

    My vote for quote of the year thus far.

  129. bairen says:

    #132

    Gary,

    Look at the stock grants your boy Ara was given last year.

    http://biz.yahoo.com/t/24/3854.html

    Capitlalist or pillager?

  130. grim says:

    From Bloomberg:

    New-Home Sales in the U.S. Fell 2.5% to 512,000 Pace in May

    Sales of new U.S. houses fell 2.5 percent in May, signaling the real estate slump will keep weighing on the economy.

    Purchases dropped to a 512,000 annual pace, as forecast and the second-fewest in almost 17 years, from a revised 525,000 rate in April, the Commerce Department said today in Washington. A separate report showed demand for long-lasting goods stalled last month.

    Falling property values, rising mortgage rates and stricter borrowing rules may keep potential buyers out of the market for much of 2008. Even as declines in housing hurt growth, Federal Reserve policy makers are forecast to keep the benchmark interest rate unchanged today on concern Americans are losing confidence that inflation will stabilize.

    “There’s just not anything out there yet to lift home sales right now,” Mark Vitner, a senior economist at Wachovia Corp. in Charlotte, North Carolina, said before the report. “The economy is still sluggish, and while prices have come down, it’s harder to get a mortgage.”

    Economists forecast sales would decline to a 512,000 pace, from a previously reported 526,000 for April, according to the median of 73 projections in a Bloomberg News survey. Estimates ranged from 480,000 to 570,000.

  131. grim says:

    From MarketWatch:

    U.S. May new-home sales fall 2.5% to 512,000 as expected

    U.S. May new-home median sales prices down 5.7% in past year

    U.S. new-home sales down 40.3% in past year

    U.S. new-home inventories rise to 10.9-month supply

    U.S. May new-home sales in West fall to 26-year low

  132. bi says:

    re: COAH. i think this former U.S. senator from democratic party said best:

    http://politickernj.com/torricelli/19381/torricelli-coah

  133. bairen says:

    #132 SG

    I stand corrected. Let me rephrase. The court mandated mission of COAH is to make all of NJ a dump.

  134. John says:

    I am going into the certified pre-owned home business with a zero percent loan model.

  135. John says:

    I don’t think new homes sales falling is meaningful, when you have a mania or a huge sale you pull in buyers early. An example would be 2005 employee pricing of cars. Everyone who was already was going to buy in 2005 bought, but a large amount of people who were going to buy in 2006 also bought in 2005 as they figured the price of the new car would be up 5K in 2006 and their current used care would be worth less on trade in. Sales sank like a brick in 2006/2007 as everyone had a new car already.

  136. bi says:

    Affordable Housing Rule Changes Discourages Economic Growth

    By Joan Verplanck, President, New Jersey Chamber of Commerce

    “New Jersey is the only state in the nation with a mandate that ties the affordable housing issue to economic growth. There is also a component of the new rules that forces companies to pay additional amounts to COAH if they decide to expand their facilities. To make expansion and job creation punishable by additional fees is at odds with the Governor’s goal of growing us out of our debt through economic vitality.

    http://www.njchamber.com/News/jun%2008%20coah.asp

  137. bi says:

    132#, SG,

    The issue is not rich towns. real rich towns will not be hurt by this new coah since they don’t have land left for commercial or residential developments so that they have limited coah abligation. the pain is given to the tax payers of middle class towns where they want to attract businesses to reduce taxpayer’stax burdens.
    middletown is hardly considered as a rich town while there are a few 10K+ mansions along the river.

    >The issue is not COAH, the issue is Rich towns using Zoning ordinances to prevent any housing.

  138. kettle1 says:

    SG,

    And is the answer to that, forcing, unrealistic / unsustainable development on communities the answer? I do not have a suggestion as i have not looked into the details myself, but assuming that there is a core of truth to the building requirements that bridgewater and similar communities would be forced into by COAH, then all COAH will turn out to be a a developers best friend that will end up doing way more damage then good to the indiviual communities.

    One big thorn in my side with COA is that towns can be forced to build on open preserved open land. Do we really want all of NJ to turn into one giant landmass of suburban sprawl? How about traffic issues? a lot of these towns are already gridlocked with the amounts of traffic that they have due to development over the last 10 years. how do you expect to get anywhere when you jump start development like COAH would.

  139. grim says:

    ket,

    There is an easier answer, cease development. No new development, no new COAH requirements.

    Perhaps this was the goal all along?

  140. Sean says:

    COAH aims to what build another 575,000 housing units in the burbs? Totally nuts to add another 2 million people in NJ?

  141. make money says:

    June 25 (Bloomberg) — Bank of America Corp.’s $3 billion takeover of Countrywide Financial Corp. will be financed by 138 million tax-paying Americans.

    Bank of America, led by Chief Executive Officer Kenneth Lewis, can use tax write-offs to pay for Countrywide, the country’s biggest mortgage lender, said Robert Willens, a former managing director at Lehman Brothers Holdings Inc. who now runs his own accounting firm. Taxpayers may pick up about $5 billion of Countrywide’s losses over 20 years, he said. Countrywide shareholders vote on the sale today.

    “Ken Lewis got a break,” Willens said. “What these losses do is reduce the effective cost of the deal so the headline price isn’t really what they’re paying. It’s entirely possible that the entire equity purchase price could be financed by tax savings.”

  142. make money says:

    http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a8C74i7bBnh0

    Here’s th elink from #147 above. UNBELIVABLE.

  143. SG says:

    And is the answer to that, forcing, unrealistic / unsustainable development on communities the answer?

    Well, I am not suggesting the approach that NJ towns, state and supreme court has chosen is right or wrong. The point is there is land of law, which was made based on litigation in NJ Supreme court. Now, one can argue better possible approaches, but since Towns lost their argument, Court mandated some solution. Either you abide by court’s mandate or file a suit against it and fight it. Once the law was created, RCA definitely does not preserve the spirit of the law.

    Do we really want all of NJ to turn into one giant landmass of suburban sprawl? How about traffic issues?

    Agreed. But Towns have no problem approving housing with 5 acre zoning law. Isn’t that significant waste of environment and Open space. I can not presume with COAH housing price limit they can afford to build even Townhouse. Most of these are going to be condos. These can be placed near public transport areas reducing traffic issues. As for schools, they can be merged to optimize the usage of facility, teaching and admin resources.

    Once again, I am not for or against development. It’s just that when there is law of land that should be followed and court’s decision should be respected. If not there are legal ways to fight it, which towns should pursue.

  144. BC Bob says:

    “Ken Lewis got a break,” Willens said. “What these losses do is reduce the effective cost of the deal so the headline price isn’t really what they’re paying. It’s entirely possible that the entire equity purchase price could be financed by tax savings.”

    Ken Lewis did not get a break. This whole deal was structured, from the start, by our treasury. Ken knew exactly what he was getting, a taxpayer bailout. If not, he had the right to walk away. Why do you think BOA wrote the housing bailout plan?

  145. chicagofinance says:

    make money Says:
    June 25th, 2008 at 11:05 am
    Here’s the link from #147 above. UNBELIVABLE.

    bost & mm: what’s the big deal?

  146. RentinginNJ says:
  147. 3b says:

    #151 BC Bob: A thundering disgrace!!!

  148. chicagofinance says:

    grim….you missed this…article has a chart that list auctioned property

    WSJ
    Investor’s Banks Hold the Bag New Jersey Property Tycoon Hits Bankruptcy, and Creditors Face Underwater Auction Bids
    By SUI-LEE WEE
    June 25, 2008; Page C17

    Two years ago, New Jersey real-estate investor Solomon Dwek was arrested on bank-fraud charges and in early 2007 was forced to seek Chapter 11 bankruptcy protection for both himself and his companies, which owned about 300 residential and commercial properties.

    His creditors began the process of trying to take over his holdings, initially valued at $300 million to $400 million, in seven states. Now, they wish they would have moved faster.

    A court-appointed trustee began auctioning the properties last fall but ran into the teeth of the real-estate downturn. In some cases, lenders have accepted far less than the mortgages outstanding. Others are opting to reject the top bids and keep the buildings, hoping the market will turn.

    “This was not a fantastic auction,” said Charles Stanziale, the trustee, after an auction of 10 commercial and residential properties last week. “There’s very little money for the benefit of the bankruptcy estate because I couldn’t get over the mortgage amounts.”

    The auctions also draw the curtain on the business of Mr. Dwek, 35 years old, a religious-school head and philanthropist in Ocean Township, N.J. He was charged by the Federal Bureau of Investigation with defrauding PNC Bank out of $25 million, of which $22.2 million was allegedly transferred to a different bank to pay off loans. He also has been sued by dozens of former investors and partners, including his uncle, Joseph Dwek.

    Solomon Dwek, who hasn’t been indicted, remains free on a $10 million bond and is being paid $12,800 monthly by his estate, with permission of the bankruptcy court, for assisting in the sale of the properties. If convicted, he faces up to 30 years in prison, said Michael Himmel, his criminal attorney. Mr. Himmel declined to comment on the FBI’s specific allegations.

    Mr. Stanziale said he tried to move faster to sell Mr. Dwek’s properties but ran into resistance among creditors. They rejected his initial plan to sell a mix of 140 houses and commercial buildings for $110 million in one bulk deal.

    Since October, Mr. Stanziale has held one auction a month. He has sold about 140 properties and has 150 left. Banks have decided to hold 49 of them.

    Of the 55 single-family homes, condominiums and parcels auctioned in April, only 25 went to third-party individuals. Amboy Bank, of Old Bridge, N.J., kept nine of the 17 Lakewood, N.J., properties it had on the block. “There was insufficient bidding to satisfy the bank’s debt,” said Cyndi Bleier, Amboy’s general counsel.

    Mr. Stanziale said there were few buyers at some of the auctions because investors typically are drawn by the possibility of fire-sale prices that often accompany real-estate slumps. But with the large amount of debt attached to these properties, Mr. Stanziale said bargains were difficult to find as the lenders were unwilling to accept offers far below mortgage amounts.

    In the auction last week, banks were more willing to accept bids less than the mortgage amounts. A four-bedroom home in Deal Borough, N.J., was sold for $918,000, below the $1.2 million mortgage held by Wachovia Corp.-owned World Savings. A Wachovia spokesman couldn’t be reached for comment.

    Banks were able to recoup $8.7 million of the $9.2 million in mortgage debt on the 10 properties. Two of the 10 went for more than the mortgage amounts. All sales are subject to court approval.

    Mr. Stanziale said in court papers that Mr. Dwek was “orchestrating a massive Ponzi scheme,” where he would use the money from bank loans to pay fictitious returns to his investors. Mr. Dwek’s bankruptcy attorney, Timothy Neumann, said Mr. Dwek himself was “a victim of a fraud perpetrated by his uncle,” Joseph Dwek.

    Mr. Stanziale also has sued Joseph Dwek, contending he had “received extraordinary false profits on numerous transactions and continued to invest with [Solomon] Dwek after realizing the false gains.” Joseph Dwek’s attorney, Steven Klein, said his client denied any wrongdoing. Joseph Dwek has said in court papers that he has given his nephew $60.2 million since 2003 to buy him properties, but didn’t realize until April 2006 that none of the properties was in his own name.

    The FBI complaint against Solomon Dwek alleges that in 2006 he deposited a $25.2 million check from a closed PNC Bank account into another PNC account. He then transferred $22 million out of the second account to HSBC Bank USA and used the proceeds to pay off two loans, according to the complaint.

    The complaint states that Mr. Dwek repeatedly assured PNC Bank that he was working with HSBC to return the money. But HSBC Bank said in court papers that Mr. Dwek never asked for the money to be returned. Both PNC and HSBC said they don’t comment on pending litigation.

  149. NYDutchessBuyer says:

    I just closed on a 4500 sqft brand new house in a 27 hole golf course comunity in Dutchess County. The community started in 1999, with avg starting baseprices for 3500 sqft homes at 475-500k. Over the years, the size of the homes went up to 4000+sqft, while the base price went up to a peak of 739k in 2007.
    The house I am buying was priced at 950k after adding 200k of options. I got it for 725k. I hope it is worth it, but I had to enter the market sometime finally.

  150. lostinny says:

    12 year old Chicago girl wins a car for good attendance

    http://gmy.news.yahoo.com/v/8509228

  151. BC Bob says:

    “bost & mm: what’s the big deal?”

    Chi,

    Ask the working stiff what the big deal is?

    You rarely get what you expect from financial markets, you get what you deserve.

  152. SG says:


    Wachovia, National City Foretell More Losses: Jonathan Weil

    The stock screen that I did turned up 218 U.S. financial companies trading for less than 70 percent of book value, which also indicates distress. The difference between their book and market values was about $177 billion.

    While markets can overshoot, their judgment this quarter will be hard for companies’ executives and auditors to ignore. The so-called credit crisis is entering its second summer, which is a long time to be in crisis mode. The argument that this is merely a temporary state of affairs won’t wash much longer.

  153. bairen says:

    #148 Are those like nols?

  154. skep-tic says:

    #98

    “At least this bill will help American taxpayers and American companies as opposed to Iraq or Afghanistan and the price tag will only be 10% of the cost of the war. How can anyone oppose it?”

    please explain how this will help American taxpayers

  155. Secondary Market says:

    This should rustle some feathers; why should we defend Realtors again?

    Faux-Market Value from Philly.com

    http://www.philly.com/philly/classifieds/real_estate/CTW_realestate_20080624_Faux-Market_Value.html

    Peter G. Miller

    Q: As a broker, I wrote an offer for a client on an FHA foreclosure house, and after a counter offer my clients were able to get the property for $374,500. Then I get a call from my client’s lender today saying that the appraisal came in at $347,000 – $27,500 below the accepted price. I was floored!

    I’ve been in the business for more than 35 years, and I had never had an appraisal come in so ridiculously low. I have buyers who are willing to settle at the price negotiated, which is fair, and now FHA wants the house values to drop even more? It doesn’t make sense! Who established fair-market value in this case? Apparently not the buyer!

    A: At first it would seem that the agreement of an informed buyer and an informed seller would represent fair-market value. But that agreement is between the buyer and the seller; the lender is a different party with different interests. The lender – the party who actually employs the appraiser – wants the most conservative valuation possible because if the loan goes into default the lender does not want to be in the position of having a property that is worth less than the loan balance. As to the FHA, it’s an insurance provider, and it, too, is not looking for extra risk.

    The reality is that the buyer and seller in your situation are welcome to close their deal if the buyer can come up with cash, financing or both to make the transaction work. However, what the buyer and the seller cannot do is force a lender or insurer to accept their terms. The bottom line: If you need the lender’s money you also need to accept that it’s the lender’s definition of fair-market value that counts.

  156. skep-tic says:

    #113

    “Risk takers get rewarded; fiscal prudence will get you nowhere.”

    hey Frank, take a look at the doc in this link:

    http://www.cepr.net/documents/publications/housing_crash_baby_boomers_2008

    I think you have a very simplistic notion of risk/reward.

  157. kettle1 says:

    well regarding COAH, we will have to see where the current exodus from the state and housing demand meet. But what do people think will happen to housing values if the level of development forced by COAH actually happens?

    If Coah is upheld, then NJ is set to be the next bombay/Mumbai,

  158. kettle1 says:

    Re #147

    The level of blatant corporate greed/political malfeasance, is so high that i do not understand why people are lighting the torches and sharpening the pitchforks. We have a 100 Trillion dollar liability in medicare/SS a failing health care system etc and the government is allowing taxpayer money to be used for corporate profit?!?!?!?!?!? These are the people who should be put in GITMO and waterboarded!. The US of A is dead. at this point we are just a bloated corpse of what was once a great nation. A greatness made by the peoples and governments action, not by military or economic might.

  159. 3b says:

    #162 Would not the buyer be very happy in this situation? I would think?

  160. BC Bob says:

    “The US of A is dead”

    kettle,

    It’s the I.O.U.S.A.

    http://www.washingtontimes.com/news/2008/jun/17/deadbeat-nation/

  161. Secondary Market says:

    #165 I would be ecstatic if that were me. I especially like how the broker is claiming the FHA is valuing the home unfairly. 35 years in the business, you would think they learned some thing.

  162. 3b says:

    #168 AMEN!!

  163. twice shy says:

    I just spoke to a builder working in the neighborhood. Current cost per square foot for new construction is $125.00 Average lot in NJ costs $400k. Build
    2000 sq. ft. for basic 3/2 and you’re already at $650k combined. So, to concur what we all know, it is not economical to build smaller homes in NJ. You’re better off buying an existing home and renovating if necessary.

  164. bi says:

    149#,

    tell me which highly ranked schools are in a big school district?

    >As for schools, they can be merged to optimize the usage of facility, teaching and admin resources.

  165. bairen says:

    Looks like corruption, well at least highly unethical behvaior for pols is not limited to NJ.

    http://www.cnbc.com/id/25370654/for/cnbc/

    Baltimore’s mayor allegedly took fancy fur coats and plane rides from a real estate developer she had a personal relationship with when she was a council member and voted to approve his projects.

  166. SG says:

    bi: tell me which highly ranked schools are in a big school district?

    I have read Maryland has county wide school districts and performance has improved significantly. I had same story from Minnesota.

  167. gryffindor says:

    It is one thing to live the doctor lifestyle if you actually make the money. Deluded residents like to start the lifestyle early. Many of the wives don’t work. Some of them have multiple small kids to take care of, that I can understand. As a female, the wives without kids who just hang out and lunch waiting for their doctor husbands to get out of residency and hit it big bug me.

    Let’s not even mention the mountains of educational debt some of these new grads have. Dental students coming out of NYU or Penn now owe nearly 400K (tuition + living) if they borrow the entire price tag. And the only starter homes to be found is your choice of 400K studio in Manhattan or POS 50 year old home in NJ.

  168. oakman says:

    I got into Med School in NJ. I turned it down because of the giant debt I would have accumulated in those 4 years. I don’t understand how any of these kids expect to pay that debt off. Residency usually lasts 3 years, it can be up to 6 years for some depending on their career choice. They get to start making money at around 30, if they are lucky. With those student loan payments from Undergrad, and Med School combined, I just don’t see how it’s possible to ever get out of the hole. Put it this way, my father is a physician, he’s 55, and he still hasn’t even come close to paying off all the debt he accumulated. He lived high and mighty, and i’m pretty sure he’ll be bankrupt by the time he’s 60. Most doctor’s I know do act like they have money, but they really only have debt. The only thing that ever allowed them to live the way they do is their home equity loan, and we all know what’s happening to those.

  169. Hobocondo says:

    #173, my obstetrician told me he was 40 by the time he finished paying off his medical school bills.

    Funny, if doctors realized how much money they could make in different ways, I wonder how many of them would still be physicians. Many of my friends are doctors, and sadly, most went to med school just for the money. They should have spared their patients and gone into business instead.

  170. bi says:

    Re: an interesting consolidation idea by
    Michael Vernotico, Councilman, City of Summit, March 17, 2008

    —-

    Trenton: Chapter 11 or a New Chapter ?

    In the 1970s, Boeing Aircraft was in deep financial straights and the one time world leader in producing commercial aircraft appeared destined for a complete demise and threatened to take its home city of Seattle with it. A billboard appeared which said, “Will the last person to leave Seattle shut off the lights?” Will we see a similar sign near Trenton some time soon?

    Debt provides a valuable service. We all utilize it for benefits today as we use those benefits in the future. It is why we take out mortgages to purchase homes and willingly sign on for car loans. It is also a way for governments to appropriately distribute the tax burden over the period of time we benefit from capital improvements. Borrowing to pay operating bills is a sign of trouble. New Jersey is in trouble “big trouble.” New Jersey is already the third largest debtor of all 50 states.

    The Governor intends to cut state spending in the budget. As a local elected official, I know that cutting spending means less funding for municipalities, who then fund these cuts through property taxes. All this accomplishes is to replace a progressive tax with a regressive tax.

    It is time to put the shell game away rethink completely the way New Jersey does business. When large companies are in danger of failing, they re-organize. They cut and redeploy staff. They develop a new business model.

    New Jersey has 566 municipalities and 21 counties. We actually have more school districts than we have towns. We simply cannot continue this way. New Jersey needs to re-organize and we should plan for a Constitutional Convention immediately. New Jersey’s system of independent communities has long been a sense of pride. Towns are already seeking shared services and it produces only limited results. Communities with 10,000 or fewer residents are encouraged to merge in the new state budget. While these actions are worthwhile, they are no where near enough.

    The system needs complete and radical change. In my opinion the best hope for change is to eliminate county government (as three states already have) and replace them with more efficient regional arms of state government as Senator Tom Kean proposed a few years back. Municipalities are aligned in counties based on an archaic demographic and geographic distribution. Millburn and Summit are sister cities with a great deal in common and have often worked together in the past to share equipment and services. What does Millburn have in common with Newark? What does Summit have in common with Elizabeth? The answer “ absolutely nothing. Why is Millburn in Essex County and Summit in Union County? Because they are. Why do we need Essex County and Union County? We don’t.

    The US Attorney Chris Christie spoke in Summit a few months ago and correctly opined that the more government you have, the more waste and corruption you have. Union County spending is up again this year by $22 million. We recently passed an ordinance to prohibit left turns out of Washington School onto Morris Avenue for two hours a day. Since Morris Avenue is a County Road, it now must be approved by Union County and then the State. This makes sense how? The answer is ” it doesn’t.” Clearly we need less government.

    Newark and Elizabeth do not need County Government either. Large urban areas should deal directly with the State, particularly with regard to state aid. Communities of similar demographics and geographically aligned should be united under a regional arm of State government to broaden the realities of sharing and eliminating wasteful county government. Smaller communities could then merge either completely or de facto. Either way, we cannot afford the silo approach going forward. We hear much talk of change in the presidential debates, but the real question is do we have the courage to take on the political obstacles and hysteria to really affect change. Do we have the courage to take on the politicians?

    We need to write a new chapter in New Jersey’s history because the chapter we are now writing is Chapter 11. We are in a real crisis of energy due to a lack of synergy. Will someone please turn on the some “energy” efficient lights in Trenton and turn off the lights in the County Seats of Elizabeth, Newark, et al?

    Michael Vernotico
    Councilman
    City of Summit

  171. PGC says:

    Interesting article on China and commodities.

    http://www.guardian.co.uk/world/2008/jun/25/china.commodities

    “In order to maintain the so-called China Price (ie lower than everyone else and thus impossible to compete against), China needs more and more raw stuff. When Mark Leonard, executive director of the European Council on Foreign Relations was writing his book, What Does China Think?, last year, the country was using 40% of the world’s cement, 40% of its coal, 30% of its steel, and 12% of its energy. According to the British Metals Recycling Association, 35% of the recovered aluminium exported by the UK goes to China (and 72% of it to Asia in general); 43% of the recovered copper goes to China (and 66% to Asia in general).”

    “last week, the BBC’s John Simpson reported from a mountain in Peru that is copper-rich: the Chinese have bought the whole thing for a bargain price and are in the process of moving a sizeable town in order to strip-mine the ground beneath it. It won’t be that long before the mountain is gone. Need is leading them to invest, says Leonard, “in all these dodgy regimes in the world, from Zimbabwe to Iran to Sudan. And that’s also changing the balance of power in those parts of the world. So China has emerged as an incredibly influential broker in all these places, and they’re places that we don’t necessarily associate with China.”

  172. SG says:

    Communities of similar demographics and geographically aligned should be united under a regional arm of State government to broaden the realities of sharing and eliminating wasteful county government.

    Basically, Summit, Millburn etc… should join forces to preserve the status quo.

  173. Nom Deplume says:

    [176] bi

    your story quoted Chris Christie, and I was reminded this weekend that the informed thinking is that Christie will be among the first expected to fall on his sword when Obama takes office.

    While dems in Trenton say nice things about him in public, he P’O’ed too many democrats by prosecuting them for corruption, and they are looking forward to getting him out.

  174. HEHEHE says:

    Re 179,

    Yeah thats a given, Christie is gone if the dems get in, which is a damn shame becuase nothing will change in this crap state unless there’s an outside force driving it

  175. Stu says:

    No fed rate cut or increase. Blah Blah Blah!

  176. BC Bob says:

    June 25 (Bloomberg) — The Federal Reserve left its benchmark interest rate at 2 percent, ending the most aggressive series of rate cuts in two decades, as higher energy costs threaten to boost inflation.

    “The Committee expects inflation to moderate later this year and next year,” the Federal Open Market Committee said in a statement today in Washington. “However, in light of the continued increases in the prices of energy and some other commodities and the elevated state of some indicators of inflation expectations, uncertainty about the inflation outlook remains high.”

    http://www.bloomberg.com/apps/news?pid=20601087&sid=abQ3cIKi7qEQ&refer=home

  177. Stu says:

    I liked it better when the FED announcements required a decoder ring to translate them. This Bergabe is as predictable as a clock. Boring!

  178. 3b says:

    And the Dow of course rallies

  179. re 178
    Summit and Millburn must not be allowed to merge. Intelligence-limited Jerseyites will avoid the place when its name changes to Sumburn.

  180. bairen says:

    Bergabe is a girly-man. If he had raised 50 bips I would no longer have held him in contempt. a 100 bip raise would have brought tears of joy.

    We need a Paul Volker, instead we get Greenspin light.

  181. Stu says:

    Sumburn? I would prefer Millit.

    How about the new Montridge school system. Sure sounds prestigious.

  182. Sean says:

    “uncertainty about the inflation outlook remains high.”

    What the F is so uncertain? That the Federal Reserve could reduce inflation uncertainty by reducing inflation?

  183. Stu says:

    What rally? Inflation is a comin’. Get yer tickets now, for they could be twice as expensive tomorrow!

  184. grim says:

    From Bloomberg:

    American Express Says Late Card Payments Increasing

    American Express Co., the biggest U.S. credit-card company by purchases and cash advances, said customers are falling further behind on their debt, signaling the economy is worsening.

    “Business conditions continue to weaken in the U.S. and so far this month we have seen credit indicators deteriorate beyond our expectations,” Chief Executive Officer Kenneth Chenault said in a statement today announcing the company would receive as much as $1.8 billion in a settlement with competitor MasterCard Inc.

  185. grim says:

    “uncertainty about the inflation outlook remains high.”

    What the hell does this mean?

    The inflation outlook is high, period.

    The uncertainty is whether or not the Fed will do anything about it.

  186. grim says:

    California sues Countrywide too?

  187. BC Bob says:

    If the charlatans wanted to do anything constructive about crude prices, today would have been perfect timing. Crude inventories were higher than expected. Combine this with a rate hike and then release product from the SPR. Crude would have been hit from all sides.

    No, the better answer is to inflate and blame the dollar demise/crude prices on the speculators. What’s the big deal? None. Just hyper-inflation.

  188. BC Bob says:

    Fisher dissented.

  189. bairen says:

    Anyone read today’s dailyreckoning?

    Points out how the neo-cons promises about Iraq were completely wrong and we have entered a period of wealth destruction for the US. Mostly caused by the neocons lack of knowledge of history and economics combined with a large dose of arrogance.

  190. Sean says:

    Perhaps a protest against the Fed’s refusal to moderate inflation is called for.

    What would happen to the banks if everyone made minimim payments on their Credit Cards for one year and withdrew all of their savings?

  191. chicagofinance says:

    BC Bob Says:
    June 25th, 2008 at 11:32 am
    “bost & mm: what’s the big deal?”
    Chi, Ask the working stiff what the big deal is?
    You rarely get what you expect from financial markets, you get what you deserve.

    Bost:
    #1 I give you the starting LF for the Giants, and you ignore me.
    #2 Last I checked, BAC got a serious smack with the ugly stick since announcing CFC. A good chunk of that taking-back-out-to-the-woodshed has been due to the CFC acquisition. Lewis stepped up to fill a need in the market. He has been punished severely. I would not deny him something that has clear economic and strategic value when (a) it amounts to specious pandering to coplain (b) is GAAP and rightfully so (c) it was contemplated as part of the acquisition either directly or ex-ante the writedowns.

  192. RentinginNJ says:

    What would happen to the banks if everyone made minimim payments on their Credit Cards for one year and withdrew all of their savings?

    withdrew all of their savings?

    Funny. Thats a good one!

  193. NJ bound says:

    I find it comical that IL is suing countrywide. Mayor Daly and Gov’nor Blagojevich are as bent as a dog’s hind leg. Blagojevich is moving closer to impeachment.

  194. BC Bob says:

    Chi,

    “#1 I give you the starting LF for the Giants, and you ignore me.”

    1)???

    2) Who cares if Lewis has been punished severly? He only stepped up to the plate with the implicit backing of our govt.. I’ll take that free put any day of the week.

    The utltimate punishment, capitalism, would be a complete implosion. Why do we reward these crooks when they profit, yet hand it over to the taxpayers upon failure? They profited by loading up the dead with debt, now they want to resuscitate the dead to string them along? So the only answer is to step in, save the idiots and pass this debt to future generations? Sadly, they did not sign up for this.

    Blow them out, start anew. Otherwise, we are turning Japanese.

  195. grim says:

    From MarketWatch:

    Radian mortgage, bond insurance units downgraded by Moody’s

    Radian Group’s mortgage and bond insurance units were downgraded on Wednesday by Moody’s Investors Service. The insurance financial strength ratings of Radian Group’s mortgage insurance subsidiaries, including Radian Guaranty and Amerin Guaranty, were cut to A2 from Aa3, while Radian Insurance was downgraded to Baa1 from Aa3, Moody’s said. The agency also downgraded Radian Asset Assurance and Radian Asset Assurance Ltd. to A3 from Aa3. The senior debt rating of the holding company, Radian Group, was cut to Ba1, which is non-investment grade, or junk status.

  196. chicagofinance says:

    BC Bob Says:
    June 25th, 2008 at 3:14 pm
    Chi, “#1 I give you the starting LF for the Giants, and you ignore me.”
    1)???

    chicagofinance Says:
    June 24th, 2008 at 10:10 pm
    BC Bob Says:
    June 24th, 2008 at 7:45 pm
    Who is this guy, Mr.Speculator, that is wreaking havoc on all commodity markets?
    “SAN FRANCISCO (MarketWatch) — Cocoa futures rose to their highest level in at least 24 years Tuesday

    Bost: I know Covelli Crisp is the CF for the Red Sox. Is Cocoa Futures the guy the Giants called up from AAA Fresno to take the place of Bonds?

  197. njpatient says:

    market swinging around like a weathervane in a tornado.

    The sheep don’t know which way to run.

  198. bi says:

    149#,

    there is no evidence supporting the theory that merging municipalities in nj will save costs. contrary to your claim, these are the facts:

    1) most small towns are already sharing resources with neigboring towns. their property tax would be many times higher than large towns if they hadn’t share.

    2) more people in small towns do volunteer work in local schools and government.

    3) residnets in small towns are more participating to the management of local goverment. thus, it operates more efficient in general.

    >As for schools, they can be merged to optimize the usage of facility, teaching and admin resources.

  199. BC Bob says:

    “Bost: I know Covelli Crisp is the CF for the Red Sox. Is Cocoa Futures the guy the Giants called up from AAA Fresno to take the place of Bonds?”

    Chi,

    Now I got it. Didn’t see it previously. I like the name. Can you imagine; Leading off playing center field, Cocoa Futures. He’ll be a speedster.

  200. bairen says:

    Look what Dubai is planning on doing with the oil money.

    http://www.cnn.com/2008/WORLD/meast/06/25/duibai.tower/index.html

    So pretty

  201. make money says:

    Can we do this state by state and bankrupt the SOB’s?

    SEATTLE — Gov. Chris Gregoire said the state is seeking to pull the license of Countrywide Home Loans to write any more loans in Washington because investigators found evidence of “predatory practices” aimed at minorities.

    The governor spoke at a news conference Wednesday at the Urban League of Metropolitan Seattle, revealing results of a an investigation into the nation’s biggest and much-embattled mortgage lender.

    Earlier Wednesday, the states of California and Illinois filed lawsuits against Countrywide. The Illinois attorney general’s office claims Countrywide misled borrowers.

    Gregoire’s office alleges that Countrywide targeted Washington’s minority communities.

  202. John says:

    Good thing I got out today. Had a nice two and a half hour lunch at Smith and Wollenskis and let me tell you the place was full everyone was ordering and I was the only dope who checked his blackberry at 2:15pm to see the rate news. People all taking about all star game tickets, vacations to tuscany and napa valley. It is good to see it is not all doom and gloom in the world.

  203. 3b says:

    #211 John:People all taking about all star game tickets, vacations to tuscany and napa valley. It is good to see it is not all doom and gloom in the world.

    People have to spend their severance on something.

  204. CB in SJ says:

    Re 209: “Look what Dubai is planning on doing with the oil money.”

    Their oil runs out in less than 20 years, so they need to diversify.

    Re 211: 2.5 hour lunch at S&W–

    I had lunch today at the one in Philly. It was by no means crowed, and by 1:30 the place was just about empty. Guess us Philuffians don’t have the panache of you NYers.

  205. make money says:

    http://www.latimes.com/news/nationworld/world/la-fg-dollar22-2008jun22,0,4999269.story

    Excellent article of USD agaist the world and it’s effects.

    It shows how everyone who is doing business with the US in $ is struggling to meet ends meet. Pretty soon they will be saying” F-You” yankees. re-align their factories and make products that they can sell in the BRIC countries.

    We will not be able to afford anything anymore.

  206. John says:

    I have friends who saw this coming and moved on to renewable energy and commodities back in 2006 and my accountant buddies moved on to IFRS and credit risk management consulting, the guys who stayed in banking or real estate are dead. The “bubble makers” are like the masters of Ponzi, they recognize bubbles early jump in and at the wiff of a peak are on to the next big thing. Worst case is they jump to soon, when my friend quit banking to do renewable energy in 2004 and was sucking wind for two years I thought he was nuts. Now he is a thought leader and making the bucks. When I did consulting I was a Russian Credit Crisis expert in 1998, a Y2K expert in 1999, a trading desk expert in 2000 and 2001, in 2002 and 2003 a Reinsurer/D&O expert, 2004 a sox expert and 2005 a Jsox/Basel II/ERM expert. I am off that train now, but the folks who ride it are like cockaroaches and I am sure they are pitching the hot topics today. There is doom and gloom for the people who go down with the ship, these rats jump off, the rest of the crowd at the resturuant today were either old money or married money. The working slobs at chase/citi were eating peanutbutter at their desks. My friend still has an expense account otherwise I would have been eating with the peanutbutter crowd.

  207. kettle1 says:

    John,

    its good to hear that you are still enjoying the bread and circus

  208. chicagofinance says:

    John Says:
    June 25th, 2008 at 3:54 pm
    Good thing I got out today. Had a nice two and a half hour lunch at Smith and Wollenskis

    JJ: Wasn’t Buffett supposed to be there for his charity lunch? Was that today?

  209. bi says:

    FYI: Nader: Obama trying to ‘talk white’

    “There’s only one thing different about Barack Obama when it comes to being a Democratic presidential candidate. He’s half African-American,” Nader told the paper in comments published Tuesday. “Whether that will make any difference, I don’t know. I haven’t heard him have a strong crackdown on economic exploitation in the ghettos. Payday loans, predatory lending, asbestos, lead. What’s keeping him from doing that? Is it because he wants to talk white? He doesn’t want to appear like Jesse Jackson? We’ll see all that play out in the next few months and if he gets elected afterwards.”

    http://politicalticker.blogs.cnn.com/

  210. bairen says:

    #214 make money

    That article depressed me. thanks to GW and his neocons they’ve turned the US dollar into the US peso.

  211. BC Bob says:

    “Pretty soon they will be saying” F-You” yankees”

    make,

    Unfortunately, I say that almost every night. They are baseball’s version of subprime.

  212. make money says:

    That article depressed me. thanks to GW and his neocons they’ve turned the US dollar into the US peso

    Don’t insult the Mexican Peso! It’s a far better currency. Mexican equivalent to the fed just raised FFR to 8.5%, a full 50BP.

    If I was to hold cash it would definitively be in peso’s before I own dollars.

  213. Herring123 says:

    Re John at Smith & Wollensky,

    Summer associate season in midtown east is in full swing, if I were a summer I’d be dining out every day, ordering the most expensive item on the menu, and planning my bar trip to Tuscany and Mykonos, etc, as well.

  214. John says:

    Most African Americans are the descendants of captive Africans held in the United States from 1619 to 1865. Others who are considered African American by the US government include voluntary immigrants from Africa, South America, and the Caribbean who self identify as being of African descent.

    Obama is not african american, he did not descend from slaves and he is not an immigrant from Africa, heck his Father did not even imigrant here. Obama is a plain old white guy. But what does the media know, Tiger Woods is Asian and they call him black.

  215. njpatient says:

    “Now I got it. Didn’t see it previously. I like the name. Can you imagine; Leading off playing center field, Cocoa Futures. He’ll be a speedster.”

    BC/Chi, I enjoyed this exchange. When I was in high school, I used to cure the boredom by creating baseball teams out of people in a particular line of work, based on what position their name sounded like.

    Example – my Jazz Musician baseball team:

    Catcher: Fats Domino; Guy Lombardo
    First Base: Tommy Dorsey
    Second Base: Glenn Miller; Artie Shaw
    Third Base: Charlie Parker; Eubie Blake
    Shortstop: Sammy Davis, Jr.
    Left Field: Fletcher Henderson
    Center Field: Duke Ellington
    Right Field: Les Brown
    Designated Hitter: Cannonball Adderly
    Pitchers: Nat King Cole, Dizzie Gillespie, Louis Armstrong, Woody Herman, Count Basie; John Coltrane; Cab Calloway

  216. njpatient says:

    217 bi
    I thought you weren’t going to be passing along your idiotic political comments any longer (irrespective of whether your hiding your racism behind Ralph Nader)?

  217. njpatient says:

    222
    “Summer associate season in midtown east is in full swing”

    so it is. I was unfortunately not able to make it to the wine tasting event the other day (or any other SA events thus far) and didn’t get my monogrammed wine cooler.

    How does the joke go? “Yesterday you were a recruit. Today, you’re staff.”

  218. njpatient says:

    pardon my grammatical faux pas

  219. John says:

    http://www.mysteryceo.com/ceo-education/my-meeting-with-warren-buffet-what-a-cheap-guy/

    I told Warren not to sit with me the cheapskate. I did hear from my friend at lunch that last week she was at a multi million dollar wedding in Malibu at a famous ranch. Well the wedding guests was staying at the nearby four seasons where paparazi were hanging out. They saw the rolls and the armani tuxes and tried to catch some pictures of the couple going into the hotel room in case they were famous. Then lunatic Heather Locklear who was staying on the floor opened her door at 2am and started yelling, they are nobodies take my picture, they are nobodies, then the next day she was by herself at the four seasons pool shaking her money maker trying to get in some paparazi shots. Oh yea today she had the nervous breakdown. What a suprise.

  220. njpatient says:

    “I told Warren not to sit with me the cheapskate.”

    Why?

    Last time I had lunch with him, he paid.

  221. scribe says:

    Bairen, you said:

    We need a Paul Volker, instead we get Greenspin light.

    But if we got a Volcker-like response – abrupt, overnight increase to a double-digit prime pushing 20% – wouldn’t the result be that every ARM in the country would re-adjust to unsustainable levels?

    When we had Volcker, we didn’t have ARMs.

    I’m foggy on the history in regards to the banking industry, but that abrupt rise in interest rates caused problems. Disintermediation, for sure – but I think it also caused problems with their portfolios of fixed rate mortgages, and the securitization market was somehow their saving grace.

    So, it will be interesting to see how much and how fast the Fed raises rates, when they finally do it.

    And, when Col

  222. make money says:

    here is a brief list of things in this country that has gone wrong to bring us to where we are today…

    (in no particular order)

    1. lax mortgage lending policies
    2. overexaggeration of credit ratings
    3. a piled up debt that we will never realistically pay off
    4. trying to solve problems with the same weapons that got us here in the first place (low interest rates)
    5. no more publishing of M3 funds, god knows how much money is printed that we no longer know about
    6. lobbyists, lobbyists, lobbyists
    7. deregulation of trading in energy markets (Enron loophole)
    8. lack of priority in dealing with the issues at hand (are we really worrying about gay marriage when we can’t pay for the gas we need to drive to the gay wedding?)
    9. gradual deterioration of the public education system relative to the rest of the world
    10. the sell-out this country is experiencing of its own corporations (for recency sakes, let’s use the Anheuser-Busch to InBeV as example)
    10. WE ELECTED BUSH AS PRESIDENT….. TWICE
    11. WE ELECTED CHENEY (aka former executive at Halliburton, with a 26 million dollar severance package of hard-earned big oil wages in his pocket) AS VICE PRESIDENT.

    We need to look at the mirror and face the music, turns malls into factories, fill them up with Mexicans and immigrants, abolish the unions, and produce actual goods.

    One problem. You actually need capital to do this. Oh i forgot we can jsut actually print our way to economic prosperity.

  223. make money says:

    We need a Paul Volker, instead we get Greenspin light.

    But if we got a Volcker-like response – abrupt, overnight increase to a double-digit prime pushing 20% – wouldn’t the result be that every ARM in the country would re-adjust to unsustainable levels?

    remember, we can’t actually raise rates cause Fed has those exact Arms on their balance sheet.

    Taxpayers own this junk now.

  224. Stu says:

    I think Obama is a big Volker supporter ;)

    But he talks white, so I would vote for McCain.

    Have you seen the new McCain Presidential Seal?

    http://ecx.images-amazon.com/images/I/51NV0SRTK4L._AA280_.jpg

  225. Stu says:

    That’s right, I meant to say that McCain is incompetent. My bad ;)

  226. chicagofinance says:

    njpatient Says:
    June 25th, 2008 at 4:59 pm
    BC/Chi, I enjoyed this exchange. When I was in high school, I used to cure the boredom by creating baseball teams out of people in a particular line of work, based on what position their name sounded like.

    njp: nice!

  227. willwork4beer says:

    231 make money

    I agree with your post make, but have a slightly different perspective on #10

    10. the sell-out this country is experiencing of its own corporations (for recency sakes, let’s use the Anheuser-Busch to InBeV as example)

    I see this as a positive sign for beer lovers. Anything Belgian has to kick Bud’s behind. And more power to the craft beers if it doesn’t…

    Just my personal bias. My one-issue politics… ;)

  228. bi says:

    make,
    to be fair, he donated all to charity after florida debacle settled.

    >11. WE ELECTED CHENEY (aka former executive at Halliburton, with a 26 million dollar severance package of hard-earned big oil wages in his pocket) AS VICE PRESIDENT.

  229. Orion says:

    Have realtors begun charging fuel surcharge after driving clients around? Uhmmmm…..

  230. BC Bob says:

    njp,

    Great lineup.

  231. njpatient says:

    237 bi

    That’s not being fair, that’s just being incorrect.

    What else is new with you.

  232. Nom Deplume says:

    [225] NJP

    Thought you said it was gonna be a long day??? You passed on the wine tasting for that???

    (I passed on ours, but hey, they were giving away blocks of cheese afterward, and lil’ nom luvs cheese)

    God, I have no life.

  233. skep-tic says:

    we bagged the wine tasting this year in favor of tasting rare vintages of Schlitz

  234. njpatient says:

    It is a long day, Nom. That was the product of a long conference call.

  235. Nom Deplume says:

    [225] NJP

    I would have Cannonball Adderly on the hill, just for the name. Also Miles Davis–that scowl of his is good for intimidation.

  236. Nom Deplume says:

    [244]

    At least you had fun. I had to figure out if we had Reg Y issues during the New Markets Tax Credit telecon today.

  237. Nom Deplume says:

    [243] skep.

    Supposedly, we are having a scotch tasting in the fall. I am expecting a robust turnout.

    Enough blogging for me. I have an article to complete and haven’t been doing it, and the *&$@# is due Monday.

  238. njpatient says:

    239 hunter

    The last time I looked at houses, the Realtor, Mrs. Patient and I arrived in three separate cars.

    It was worth it – we had a great Realtor.

  239. grim says:

    Scotch tasting? Wine tasting? What fantasy world do you work in? Next you’ll be telling stories about unicorns and bonuses.

    Oh how I miss the dot com days.

  240. njpatient says:

    243 skep

    Not Schaeffer? (Properly pronounced Shah fee yay)

    Not Beast?

  241. njpatient says:

    Nom
    “Supposedly, we are having a scotch tasting in the fall. I am expecting a robust turnout.”

    Could you invite a prospective lateral?

  242. njpatient says:

    Adderly was a tough call. With the arm, he was really eligible at pitcher, third base and right field.

  243. Sean says:

    Anyone else see the Red Angels fly over NYC today around 7 PM? They were flying low and in a tight formation. Nice to see the Brits protecting NYC.

    http://www.raf.mod.uk/news/archive.cfm?storyid=B4B1938E-1143-EC82-2E3A88A2D977978E

  244. grim says:

    So much for limiting the systemic risk posed by the GSE portfolios…

    From Bloomberg:

    Freddie Mac Mortgage Portfolio Rises to Highest Ever

    Freddie Mac’s portfolio swelled to the highest level ever as the U.S. mortgage-finance company used its expanded buying powers to invest in securities it guaranteed.

    The portfolio rose by $32.8 billion to $770.4 billion in May, the McLean, Virginia-based company said today. Washington- based Fannie Mae’s holdings rose by about $8.5 billion to $736.9 billion, according to its monthly summary. It was the second straight month Freddie Mac’s portfolio eclipsed Fannie Mae’s.

    “Both GSEs were given the green light to buy up to $100 billion and Freddie took that to heart a little more than Fannie, despite the fact that Freddie hasn’t raised the capital yet to support that growth,” said Credit Suisse analyst Moshe Orenbuch, who has underperform ratings on the stocks of both companies.

  245. grim says:

    From MarketWatch:

    Worst yet to come from credit, real estate crunch

    Talcott Franklin, co-author of the “Mortgage & Asset Backed Securities Litigation Handbook,” says that the credit crisis and real estate bubble has barely scratched the surface and will get much worse before there’s any improvement.

    In a radio interview with Chuck Jaffe, MarketWatch senior columnist, Franklin said the current situation is “the Mount Everest of housing bubbles,” and noted that recovery from the last big real-estate bubble — caused by the savings and loan crisis of the 1980s — took 10 to 14 years. This one may take even longer, he said.

    “If you look at the housing bubble that was contributed to by the subprime lending environment, you see the Mount Everest of housing bubbles, as opposed to every housing bubble we have seen before,” Franklin said. “It is unlikely that we will see a significant recovery in housing prices, given the size of the housing bubble.”

    Franklin said he has no reason to expect any sudden increase in housing prices to save the market from the downward spiral created by the rush to subprime loans that occurred earlier this decade.

    Moreover, Franklin predicted that the mortgage and credit mess will not be contained in the subprime space, noting that the least creditworthy borrowers were the weakest link and thus had to fall first. The crisis, he said, will move up to the next level of borrowers as many American businesses and families continue to use credit to live beyond their means.

    “The bills are coming due and someone will have to pay them,” Franklin said.

  246. njpatient says:

    254 grim
    I’m with clotpoll on that one. Two giant garbage cans, and the goal is to stuff them as full of trash as possible before the taxpayers find “take out the garbage” on our honeydew list.

  247. bairen says:

    #254 grim,

    nothing to fear, Fannie and Freddie are both too big to fail.

    Just like the British and Roman Empires.

    Oops. Bad examples.

    Ahh. We’re all buggered

  248. kettle1 says:

    careful everyone!!!!

    School locked down after ‘ninja’ sighted in woods

    The Associated Press

    BARNEGAT, N.J. – It’s the case of the nonexistent ninja. Public schools in Barnegat were locked down briefly after someone reported seeing a ninja running through the woods behind an elementary school.

    Turns out the ninja was actually a camp counselor dressed in black karate garb and carrying a plastic sword.

    Police tell the Asbury Park Press the man was late to a costume-themed day at a nearby middle school.

    The lockdown began shortly after 9 a.m. Wednesday and lasted until 9:30.

  249. njpatient says:

    “The bills are coming due and someone will have to pay them,” Franklin said.

    Ridiculous.

    I wish I weren’t someone.

  250. bairen says:

    #261 njp

    You can avoid paying them bills. i believe as an attorney you qualify to move to Australia as a skilled worker. 2 years later you would be eligible to become an Aussie.

  251. kettle1 says:

    SO Nom,

    how long before you want to setup the NJrereport costa rican commune?

  252. kettle1 says:

    nj patient,

    it really does make you wonder when the sheep might start to stir a bit? how much are they/we really going to take?

  253. kettle1 says:

    hey this is the land of the free, the land of “the rule of law” right? right?!?

    Gitmo Detainee’s Lawyer ‘Not Allowed To Tell Him’ He’s No Longer An ‘Enemy Combatant’»

    http://thinkprogress.org/2008/06/25/parhat-combatant-solitary/

  254. bairen says:

    kettle,

    I think once cheese puffs and twinkies (2 of our 4 major food groups) hit $6 a box that’ll cause the masses to lift up their bloated bodies and start waddling in the streets.

  255. skep-tic says:

    #247

    scotch tastings tend to degenerate pretty quickly. Maybe they’re laying a trap so there is an excuse to can a few people.

    #250

    my pallette is so well aquainted with the Beast from my college days that a tasting would be completely redundant.

    this was the standard keg in my college years:

    http://beeradvocate.com/beer/profile/105/1484/

  256. Sean says:

    re: bankers bailout bill.

    Send Senator Menendez an email on the THE HOUSING AND ECONOMIC RECOVERY ACT OF 2008 he is on the Senate banking committee. FYI, the bill is on the floor and vote is due perhaps by Friday.

    Even SHILLER is endorsing this one.

    http://banking.senate.gov/public/index.cfm?Fuseaction=Articles.Detail&Article_id=bc5488e1-11d0-4274-a2ed-953825ef184b&Month=6&Year=2008

  257. Enjoy the steak while it lasts. A lot of companies are getting to the end of the financial year and are in the process of burning through the last of the entertainment budget.

    My employer is laying on the lunches and after work drinks in a last frenzy. Come July 1st all contractors will be shown the door unless their are on a chargeable account. By September if the Q1 numbers are not hitting targets, the layoffs will start.

    Anyone for some port or a Grappa?

  258. njpatient says:

    Bairen

    “Ahh. We’re all buggered”

    I believe the phrase you wanted was “we’re all buggered in the end.”

  259. njpatient says:

    kettle

    “hey this is the land of the free, the land of “the rule of law” right? right?!?”

    No.

    This has been another episode of Easy Answers To Easy Qestions.

  260. rhymingrealtor says:

    Orion,

    We all don’t drive our clients around, I have often been driven.

    KL

  261. njpatient says:

    Driven to drink, no doubt

  262. Sassy says:

    #232 Make Money

    uhm, actually we only elected Bush the 2nd time around (I know, still no excuse)… the Supreme Court paid back a favor the first time.

    Yep, still bitter… sigh… still having nightmares about “chad.”

  263. JBJB says:

    40% of sheeple still support Corzine:

    http://www.app.com/apps/pbcs.dll/article?AID=/20080625/NEWS/80625013&referrer=FRONTPAGECAROUSEL

    Even worse:

    But the poll found New Jersey voters know little about how major decisions by the
    Supreme Court affect state spending and quality of life.

    Fifty-one percent of those responding said they had not heard about the court-ordered housing requirements and 23 percent said they had heard “just a little.” Forty-one percent said they’ve heard nothing and 32 percent “just a little” about the state Council on Affordable Housing, which implements affordable housing requirements.

    This state is full of complete morons. How is that single party government treating you now?

    I think that should be Obama’s campaign theme: Obama – bringing NJ to DC so everyone can get a taste.

  264. Frank says:

    #275,
    If you have such a problem with NJ then move out. Why are you still here?

  265. HEHEHE says:

    Just read that Shiller piece from the NYT. What a monumental load of dramaticized crap that editorial is!!! You talk about bs. When those families were being evicted for not paying rent this government could give a flying f*ck. Put them in a house with some creative mortgage lending and all of a sudden we need to bailout the dumb@ss bank who gave them the loan!!! This doesn’t have a frigging thing to do with those families its about giving a politically connected business a bailout because they made some stupid business decisions.

  266. JBJB says:

    “If you have such a problem with NJ then move out.”

    I just might, along with many other young, educated, hard working, productive people. Who is going to pay for your welfare state then?

  267. chicagofinance says:

    I recall a case of these was $4.99 at Wegman’s in Ithaca. Kind of says something when the can deposit increases the case cost by 25%.

    http://www.ratebeer.com/beerimages/full_size/15723.jpg

  268. paul2 says:

    Grim,
    Is there a way to show this graph, corrected for inflation and taking the year 2000 as the reference?

Comments are closed.