From the St. Louis Fed:
The Mortgage Crisis: Let Markets Work, But Compensate the Truly Needy
From the AFP:
Fed study says home price drop ‘necessary’
Large-scale government intervention in the US housing crisis would be counterproductive and prevent a “necessary” correction in home prices, according to a Federal Reserve study released Monday.
The study by economist William Emmons of the St. Louis Fed concluded that “government interventions directly in housing or mortgage markets are not necessarily the best policy responses.”
“By allowing markets to sort themselves out quickly, a foundation for sustainable homeownership and responsible mortgage lending can be re-established,” the regional branch of the central bank said.
The report said home prices in many parts of the country may fall from their peak levels in 2006 or 2007 by the largest amount in several decades, but that “from an economic standpoint this decline of overvalued properties is necessary.”
“If house prices are allowed to remain artificially high, homebuilders will make the eventual correction even worse by supplying more unneeded houses and driving prices down even further,” the report said.
The economist noted that the phenomenon of home foreclosure is an “unpleasant, but essential aspect of the mortgage market.”
“In order to ensure the mortgage market functions effectively, the lender must have the ability to seize the borrower’s property as collateral,” the report said.
“Without the possibility of foreclosure, mortgage rates would be more on par with those of credit cards,” said Emmons.
“It is important to keep in mind that there will be those individuals who are truly harmed by the crisis,” said Emmons.
“The financial distress to borrowers and communities caused by foreclosure should be addressed directly,” he said, with a stronger “social safety net.”
Someone send this to Congress, because they don’t care and will pass the bailout anyway. Suckers are waiting to pay for it.
From the St. Louis Fed:
The Mortgage Crisis: Let Markets Work, But Compensate the Truly Needy
has this guy been fired yet? Last I checked, the $300B bailout was moving full steam ahead
He’s never gonna keep his job with ideas like that…
sarcasm off/
I think Mr. Emmons car is about to run off a dark, deserted road.
Sounds like a disgruntled Federal employee. He’ll probably keep writing papers like that until Mozillo gives him a lifetime membership to ForeverTan.
From the Star Ledger:
Carla Katz removed as president of state-worker union
CWA leader Carla Katz, the former girlfriend of Gov. Jon Corzine, was removed from the presidency of the largest state-worker union today after an internal investigation found evidence she misappropriated union funds and violated federal labor law, according to a CWA news release.
The action was taken after a unanimous vote of the national board of the Communications Workers of America, which appointed a temporary administrator to oversee CWA Local 1034 pending the outcome of a July 22 hearing.
“An extensive internal review revealed probable cause to believe that the local is engaged in ongoing financial malpractice, the misappropriation of union funds, a failure to comply with state and federal law, as well as the CWA constitution, and the suppression of dissent,” CWA’s national board said in a news release. “The CWA national executive board has determined that it has no choice but to take this action to protect the rights and resources of the members of Local 1034.”
#2 Where was this guy in 05?
#7 Is there a future perp walk for Katz?
“Fed study says home price drop ‘necessary’”
I said that too a short while ago. Maybe we should ask more programmers and less economists. Definately less realtors and appraisers :)
grim (7)-
Guess Carla had better invest in a fresh, new pair of knee pads.
“…extensive internal review revealed probable cause to believe that the local is engaged in ongoing financial malpractice, the misappropriation of union funds, a failure to comply with state and federal law, as well as the CWA constitution, and the suppression of dissent…”
Funny. I thought all this stuff was part of Carla’s job description.
re Fed Study, so, in he last three decades does anyone have an idea of what would amount to the ‘largest drop’? Could NNJ possibly figure into the picture as one of these parts of the country? Thanks if anyone has some thoughts on this.
http://www.npr.org/templates/story/story.php?storyId=92213600
“Her latest book, When I’m Sixty-Four: The Plot Against Pensions and the Plan to Save Them, proposes that pensions should be managed by the federal government rather than Wall Street.”
From Bloomberg:
IndyMac Cuts Half its Staff as Mortgage Losses Mount
IndyMac Bancorp Inc., the lender whose market value has plunged by almost 90 percent this year, will fire half its employees after regulators said the company is no longer “well capitalized” and the quarterly loss widened.
IndyMac will slash its workforce by 53 percent to 3,400 employees and curtail lending, the Pasadena, California-based lender said today on its Web site. The company said it is working with regulators on a new business plan.
“We don’t expect to be able to raise capital until there is more stability and less uncertainty in the housing and mortgage markets,” Chief Executive Officer Michael Perry said in the statement.
IndyMac, the second-biggest independent U.S. mortgage lender last year behind Countrywide Financial Corp., has lost almost $900 million in the nine months ended in March amid tumbling home prices. The company is focusing on mortgages that can be sold to government-sponsored enterprises like Fannie Mae and Freddie Mac.
Pat – Your new town sounds great. Apart from the Barbies that is.
#7 What a surprise, more corruption in NJ> Thank goodness we have NNJ to defend NJ.
Back from first day on the job.
Better than expected.
I get a secretary and an expense account (unexpected) and every possibility of moving to a 4 day workweek to help with gas costs, so the giant commute will be less of a burden.
If I can work out a telecommute eventually one day a week we would REALLY be talking.
Nice people, great environment. Absolutely no complaints. Looks like I will be very busy though.
Pat, I just spent the weekend on my best behavior as I was at the bf’s home where he grew up somewhere in your vicinity. His mom and I went for a walk through a very long and nice walkable stretch of their suburb with pools and schools and stores just like you described. I flipped through the local paper and was surprised at the number of places around DC offering 2 – 2.5 months of free rent just to get people in the door. Sounds like it’s a good time to be a renter if you want to live in downtown DC.
lisoosh, if I weren’t worried about a possible lurker amongst them, I’d post a hair-raising picture I found on a newsletter from one of the groups they’re in. I don’t know if and/or where you went to college, but when I went to Penn State, chicks from Maryland were considered Barbieclones.
Maybe I’ll risk it. The picture.
One weekend last month though, I found hope. We were waiting to meeting someone to look at his house (not yet sold, so renting). Next door, a 50-ish woman in clogs was gardening in the rain. I walked over and shouted to her her that she looked like my best friend – an immigrant from Germany who had, sadly, moved South, far away from me. She jumped up and said, “I am from Germany! My husband died, and I am now retired! Come to eat with me.”
I now have high hopes for my interim time in Maryland until I find a job. Belegtes Brot. Beer. Wurst. Nichtes Barbie.
Real estate in Bergen County (per the NJMLS data) is on fire.
It’s burning DOWN.
First Half Stats
Year Sold U/C*
1991 3,151 4,794
1992 3,591 4,966
1993 3,542 4,919
1994 3,940 5,180
1995 3,235 4,639
1996 3,500 5,359
1997 3,834 5,253
1998 4,246 5,882
1999 4,364 5,494
2000 4,054 5,189
2001 3,822 5,019
2002 4,545 5,468
2003 4,139 5,344
2004 4,652 5,844
2005 4,796 6,026
2006 4,024 5,167
2007 4,134 5,110
2008 2,889 3,849
*Under Contract = Pending Sales
Sales down 40% from peak in 2005, U/C down 36% from peak in 2005
Median price is down 6% from the peak in 2006
soosh (18)-
Welcome back to the world of grifting. Whatever it is you’re doing, it damn well beats the crap out of telling deadbeats to stay in their homes rather than mailing back the keys and taking the Penske Express to NC in the dead of night.
Best wishes to you in the new job!
Pat (20)-
“I now have high hopes for my interim time in Maryland until I find a job. Belegtes Brot. Beer. Wurst. Nichtes Barbie.”
You’re below the Mason-Dixon. Tread lightly.
“Real estate in Bergen County”
Are you telling me that with everything that’s going on in the RE market, 2,889 homes still sold? That’s a great news. Even better news is the fact that prices only dropped 6%.
Most people in this country only wish for this kind of market. Let’s hope things continue this way.
Hey RichinNNJ,
Thanks for that pickmeup data! Any idea how many homes were for sale during the first half of the year (2008) for BC?
“5 luxury condos? Funny, I only count 4.”
If you have the guts to offer a 1 bedroom in Hoboken for 1M, market still must be good.
Frank (26)-
“If you have the guts to offer a 1 bedroom in Hoboken for 1M, market still must be good.”
Frank, don’t confuse stupid- or being tapped out- for guts.
“Are you telling me that with everything that’s going on in the RE market, 2,889 homes still sold?”
i think I kind of agree with this bloke.
I thought sales would be worse.
but, this also has along way to unravel.
If this number stays constant, there will be massive pain.
if that number dips below 2k, they will be sending people to FEMA camps.
SAS
“PSE&G Seeks Increase in Electric Transmission Rate”
http://tinyurl.com/5vnv26
SAS
Clot, don’t think I’m not worried. I’m five feet tall, but as you know, I wear size 13 stompers when it comes to treading.
Unless Bergen County population or household formation takes a dive, the buyers and sellers will retrun. Question is which side can wait out the longest.
NNJ (31)-
Bergen Co’s population is dropping.
Bergen Co’s household formation is dropping (as are the national numbers).
Markets in decline feature buyers who can wait longer than sellers can remain solvent.
Next?
“Question is which side can wait out the longest”
thats easy to answer. we done borrowed and used up all our future buyers.
moving forward, there will always be more sellers than buyers.
SAS
Clot – Thanks. I’ll be trying to pry cash out of the hands of the well heeled. Lots of shmoozing. It has some negatives, but compared to B to B sales, or listening to kids and bored housewives bickering all day it is a dream.
Pat – I WANT TO SEE THE PICTURE. Lurkers be d*mned. Glad you found surprisingly compatable company. I went to college in Scotland, so no Barbies there. But we do have one or two at my gym. Luckily the rest of us plebes outnumber them so they haven’t managed to get a serious foothold. I find Barbies like company and prefer to travel in packs.
“Intervention Will Not Stop the Dollar’s Slide”
http://tinyurl.com/67jh6b
SAS
#32
Clot,
NJ seems to be following the same pattern as San Diego and Las Vegas. Price increases slow, flatline, then prices drop a bit but volume falls significantly. Then comes the crash. I’m already seeing prices off 15% and more in Florham Park, Basking Ridge, Warren, Summit, New Providence.
I think we are nearing the look out below stage if NJ follows the other bubble land bursts. Especially as credit gets tighter and tighter.
If you have the guts to offer a 1 bedroom in Hoboken for 1M, market still must be good.
Askin’ ain’t gettin
Someone forgot to tell all those buyers in Bergen.
All those slacker Gen Y will eventually have to move out, form household and get their own place.
The last number I found on Bergen County population was 2006 which showed an increase from prior years.
As home prices decline and Washington struggles to end the economic malaise, Wall Street is starting to send a sobering message: The worst is yet to come.
….
The declines, along with a falling stock market and growing unease about the possibility of more red ink at big banks, reflect a growing conviction consensus among investors that the current housing slump will last longer, and prove more severe, than initially feared.
http://www.nytimes.com/2008/07/08/business/08fannie.html
I think that last sentence should really end like this:
“reflect a growing conviction consensus among even the most stupid investors that the current housing slump will last longer, and prove more severe, than initially feared.”
“All those slacker Gen Y will eventually have to move out, form household and get their own place”
nope, not in NJ. People in their 20s still suck on mom’s teets until Mom dies or goes to a home, then they take over the roost.
You may have heard of the Chicago way, but this my friend, is the NJ way.
SAS
“Still making money by resisting siren song of subprime”
http://www.denverpost.com/economy/ci_9789811
SAS
Not the Gen Y I know. They get a place close to Parents, and the helicopter parents never move south.
NNJ (38)-
“All those slacker Gen Y will eventually have to move out, form household and get their own place.”
Oh, yeah…there are some real moneyed-up, ready-to-pull-the-trigger buyers. Damn, I didn’t think of all those people for a minute. Let me revise my previous statement; all is well!
Beavis and Butthead, moving out of the MaPa Hotel, are going to save the BC market.
Please send me some of what you’re smoking. Now.
NNJ (43)-
“Not the Gen Y I know. They get a place close to Parents, and the helicopter parents never move south.”
In case no one else has mentioned this to you, NNJ: you’re shoveling shit all over yourself.
bairen (36)-
I don’t think we’ll hit the Ground Zero cities’ (San Diego, Vegas, Miami, Phoenix) depths when our prices go into free fall. That being said, I do believe it will be worse than anything ever seen here before…because NYC won’t be the source of fleeing & moneyed-up buyers. Also, NJ has never entered a RE downturn with a cemented reputation of being a complete welfare state.
Last time around, we at least had the reputation of being a job incubator and wealth-producing state. That’s long gone, probably never to return.
hey blokes!
Just bought a steam distiller…
its way cool dadio!
nice clean water;)
SAS
Lisoosh
Congrats! Welcome back to the world of work. It sounds like it was the right decision.
sas (47)-
Buy some used Sherry and Burgundy barrels, and give me a call.
Speaking of helicopter parents- the tenant that moved in downstairs did so because his daughter is going to school here in the neighborhood. She has a separate place and he moved to the same block. It’s the most bizarre thing I’ve ever heard. This takes the f@(king cake!
#46 Clot,
I think NJ is going to drop at least 35% from peak, maybe even up to 50%. When you throw in higher energy and food, tighter lending standards, and serious job losses on Wall St and Pharma, prop taxes going up 7%+ it’s going to get ugly.
Maybe not like Tampa’s 30 cents on the dollar ugly, but still ugly.
l – I’m wincing here, and these could be truly nice folk who just happen to look like a sorority 25 year reunion. But I’m posting it. P4.
http://tinyurl.com/6qxpzn
Now, that’s not the town I’m moving to, but it’s similar, in many ways.
Pat
I guess it’s the NY in me, but having a caption mentioning a Hoedown under a picture of 5 or 6 women just made me wonder why they’d advertise it in the town newslatter.
#52 Pat
Page 4 has an article about a hoedown. Where’s John when we need him?
#53 lostinny
You beat me to it!
bairen (51)-
Wouldn’t shock me. Who knows where this thing will end up? We’re in uncharted waters.
I’m not a data geek, but I’d love to see the YOY numbers for NJ during the Depression. If I were modeling future declines, that’s a baseline I’d want to build into my projections.
53 That’s newsletter. Damn fingers.
55 Bairen
Gotcha!
Bairn and lost, thanks, I needed a shit and a giggle.
Just spent the last hour dealing with my little girl’s “sad sickness in the belly” and crying.
Apparently, in our current mixed/diverse community and her summer camp, there are some very wise 8 year olds who told her that nobody in Maryland likes new kids, especially from up here.
In fact, J’naiaisa told her she better just stay up here with her.
Pat (52)-
That’s some sick shit. Like friggin’ Halloween, every day of the year.
Word to those ladies: crunches.
Arm yourself.
NNJ,
Bergen County averaged zero population growth over the last few years as the number of American citizens leaving BC were roughly offset by immigrants & babies.
While there were outight population declines in 2005 & 2006, there was an uptick in 2007 as the number of people leaving BC dropped. A Rutgers Bloustein School (don’t have a link, but I’m sure you can find it)postulates that the slowing of people leaving NJ is because many people can’t leave at this point because they can’t sell their homes & don’t have enough equity to drop the price to a realistic level.
For some people it’s as if the last helicopter has left Saigon and they are left behind, unable to leave, stuck in a home falling in value, with inceasing property taxes.
http://www.census.gov/popest/counties/files/CO-EST2007-ALLDATA.csv
Who the hell has time to write a 20 page newsletter?
Pat
I’m sorry your little girl is dealing with this. I’m sure if she continues to be herself, they will like her and feel bad they said anything so terrible. And if not, you can always take them all to see Hancock and threaten to do to those kids what he did to the bully.
“Are you telling me that with everything that’s going on in the RE market, 2,889 homes still sold? That’s a great news. Even better news is the fact that prices only dropped 6%.
Most people in this country only wish for this kind of market. Let’s hope things continue this way.”
Frank, are you for real? I really can’t tell. Is this supposed to be sarcasm? Is this some attempt at humor through parody?
Sales started declining in 2005 yet prices kept rising through 2006. Sales are dropping dramatically but prices aren’t falling at similar paces. This screams of artificially inflated prices. The real estate industry had already been cited by the government for artificially inflating prices as early as 2001 so it wouldn’t be a surprise to find out that’s more what’s keeping housing prices from crashing the way sales have.
Do you have a brother named Donald or something?
hm… I posted a comment it doesn’t show, not even as in moderation. If I try to resubmit it says it’s a duplicate. Did something change?
nevermind there it is. I cleared my cache and everything and didn’t see it.
THINK FHA….THE DOWN PAYMENT DOES NOT HAVE TO COME FROM THE HOME BUYERS FUNDS, LENIENT CREDIT SCORES AND THE RATES ARE THE BEST IN THE MARKET…..WE CAN SELL OUR LISTINGS IF WE GET CREATIVE. LETS FIND THE BUYER THAT NEEDS A BREAK.
The above is from an actual listing.
KL
kl (65)-
Sounds like an invitation to mortgage fraud. And, a POS listing.
BTW, Jamie Dimon on Charlie Rose right now, acting like he has a clue.
Everyone, please now ignore JPM’s derivatives exposure…
reporting from Swan and Dolphin in Disney,
Everyone here is from europe and latin America. Unbelivable.
On the 4th, Magic kingdom was closed as it reached capacity. It was literaly a zoo, chaotic experience.
Everyone is spending money.
Don’t underestimate the foreign consumer.
Too funny. I know someone who works there, and it’s always like that. Top hotel in Disney. Starhot rate, baby!!
You want to freak someone there out, ask about the woman who killed her husband a few months ago at the hotel. Was kept super down low. She caught him cheating.
Clotpoll Says:
July 7th, 2008 at 9:40 pm
Frank (26)- “If you have the guts to offer a 1 bedroom in Hoboken for 1M, market still must be good.” Frank, don’t confuse stupid- or being tapped out- for guts.
clots: Mr. Futer is jess trollin’….
I’m going through files and papers, getting ready to move. I came across a folder containing info from my ill-fated 2004 real estate search. Agents handed out fliers showing how affordable a given property was with 3/1 ARM, 5/1 ARM, etc. showing the estimated monthly payment for each scenario in neat little rows. On some of the properties I checked the creative loans would have cost about $1000 less per month than a traditional 30 year fixed – and that was with mortgages dipping below 5%. I’m going to keep the fliers for the Alan Greenspan Bubble Museum collection.
Gen Y ( which I am in )
Lives at home driving the leased M3 making 60-70k while working on masters degree.
oops I was wrong. My post is in moderation :(
I know I should have tried to sell some sort of sex aid instead of talking about the real estate market.
OT
but a laugh for the day
http://www.keithwhite.us/footballquote.html
Similarities between 1929 and 2008 terrifying
The Prairie Dog Press
Will Bagley
Article Last Updated: 07/05/2008 11:40:47 AM MDT
Click photo to enlarge
Will Bagley
* «
* 1
* »
Watching Wall Street and the American real-estate market crumble over the past 10 months has not inspired great confidence in our wonderful free-market economy or the land pirates who run it. As someone who recently wrestled with the causes and consequences of the Great Depression, I find the current economic shipwreck not merely spooky but downright terrifying.
Working as a historian is a discouraging business. No one seems to learn anything from history – that’s pretty much a given – but we keep hoping. As a chronicler of the 19th century American West, I had my work cut out when a family friend asked me to write a biography of her father, Judge Wilson McCarthy.
Herbert Hoover appointed McCarthy to represent Western Democrats on the board of the Reconstruction Finance Corporation, Hoover’s only real response to the worst economic disaster in American history. The RFC attempted to restore liquidity to the economy by getting cash out from underneath mattresses and into circulation.
Last year I had to look up “liquidity” to remind myself what it meant. Today I could sort through 23.2 million Google hits to learn more.
“History doesn’t repeat itself,” Mark Twain said, “but it does rhyme.”
The similarities between economic conditions in 1929 and 2008 rhyme like hickory, dickory, dock. As early as 1935, “brain truster” Rexford Tugwell identified the root cause of the
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Great Depression as the failure “to pass on a fair share of the spectacular productivity gains of the 1920s” to both labor and consumers.
An enduring agricultural depression, the grossly inequitable distribution of wealth, massive consumer debt, tax cuts for the rich and what historian Robert S. McElvaine called “the wild speculation of the decade’s orgy of greed,” all made matters worse. This multifaceted bankruptcy led to the Great Depression, but massive corporate corruption and the incompetence of the ruling class are unappreciated, if familiar, factors in creating the catastrophe.
Free marketeers struggle to explain away the collapse of the virtually unregulated economy of the Roaring Twenties. In 1963 economist Milton Friedman elucidated the failure of laissez faire as “a tragic testimonial to the importance of monetary forces.” Adam Smith’s disciples laid the blame on the regulators, specifically the Federal Reserve Board’s attempt to rein in speculation on Wall Street.
At Friedman’s 90th birthday celebration in 2002, then-Fed board member Ben Bernanke said, “You’re right, we did it. We’re very sorry.” I wonder what Chairman Bernanke is sorry for now?
The only trouble with capitalism is the capitalists, Herbert Hoover told a journalist. “They’re too damn greedy.” The Depression proved him right. “We must all do our bit,” said J. P. Morgan, but the great financier did not pay a nickel in federal income tax in 1930, and neither he nor his partners paid any in 1931 or 1932.
Treasury Secretary Ogden Mills granted his father’s estate $6 million in relief on what is now damned as the “death tax.” The Chicago Tribune called on citizens to pay their full taxes, while its publisher, tycoon Robert R. McCormick, handed over only $1,515. Investment banker S.J.T. Strauss paid a whopping $18 in taxes. At the same time, wealthy Americans sent $100 million in gold to Europe every week in the first months of 1932.
As a survivor of what he called “the Great Slump,” the great European historian Eric Hobsbawm found it almost impossible to grasp how free-market orthodoxy, so obviously discredited in 1933, “once again came to preside over a global period of depression in the late 1980s and 1990s.”
Hobsbawm believed this strange phenomenon evoked “the incredible shortness of memory of both the theorists and practitioners of economics.” It also showed why society needed historians to act as “professional remembrancers of what their fellow citizens wish to forget.”
There are differences between today and 1929; for example, the dollar was in great shape and the deficit was virtually nonexistent. So why worry? Most historians believe history doesn’t repeat itself. It just seems to.
—
* WILL BAGLEY is an author, publisher and historian. Utah State University Press released his “Always a Cowboy: Judge Wilson McCarthy and the Rescue of the Denver & Rio Grande Western Railroad.”
Citi: Banks Will Have $5 Trillion Restored to Balance Sheets
Monday, July 7, 2008 4:54 PM
Article Font Size
Accounting changes expected to take effect by 2009 will add $5 trillion to the balance sheets of banks and other U.S. financial institutions, says Citigroup’s head of global credit strategy Matt King.
The changes will return to banks’ books the majority of the assets that were securitized previously — but those assets will not need to be funded, King told the Financial Times.
http://moneynews.com/streettalk/securitized_assets/2008/07/07/110645.html
Troll (24),
Nice try.
vodka (75)-
Nice to see that Citi has decided that its strategy will now be grounded in the concept of magical rescues.
afe (25),
Inventory data only goes back to 2004. Here is the data for the first half of the year.
Year Units Active
2004 4131
2005 4113
2006 6680
2007 6351
2008 6591
Al,
this one’s for you
Indian city pays residents to use toilet
http://www.cnn.com/2008/WORLD/asiapcf/07/07/india.toilets/index.html
Boone Pickens on Squawk, laying out his plan to save the world.
#74 kettle1
“At Friedman’s 90th birthday celebration in 2002, then-Fed board member Ben Bernanke said, “You’re right, we did it. We’re very sorry.” I wonder what”
Is he talking about the 30’s or 2009?
I have a theory on how Bergabe got his post. Must share it at the next GTG
From MarketWatch
Fed aid to brokers may be extended beyond 2008: Bernanke
The Federal Reserve’s emergency loans to broker-dealers may be extended beyond 2008, Fed Chairman Ben Bernanke disclosed Tuesday. “We are currently monitoring developments in financial markets closely and considering several options, including extending the duration of our facilities for primary dealers beyond year-end,” Bernanke said in a speech to an FDIC-conference.
But otherwise, everything’s peachy! Bordering to “on fire”!
Grim I’m in mod? Oh its the c word.
From Bloomberg
Fed’s Loans to Wall Street May Prevent Raising Rates This Year
The Federal Reserve may hold off on its first interest-rate increase since 2006 until policy makers judge that financial markets are stable enough to allow the central bank to withdraw its lending backstop for Wall Street.
Raising rates while at the same time removing securities dealers’ access to direct loans from the central bank would be a double hit to markets that officials probably want to avoid, Fed watchers said. The Fed also may have a hard time justifying higher borrowing costs before it has a plan for ending emergency lending to nonbanks.
From Bloomberg
Fannie, Freddie Capital Concerns Send Bond Risk to 14-Week High
Fannie Mae and Freddie Mac triggered a surge in the cost of protecting company debt from default to the highest in 14 weeks on concern the two largest U.S. mortgage finance companies may need to raise $75 billion.
…
Record delinquencies on home loans already helped cause financial companies worldwide to write down more than $400 billion on debt holdings and prompted Fannie Mae and Freddie Mac to raise almost $20 billion in new capital. They may need as much as $75 billion more as new accounting rules require them to bring off-balance sheet mortgages on to their books, according to Lehman Brothers Holdings Inc. analysts led by Bruce Harting.
“Fannie and Freddie spooked everything,” said Jim Reid, head of fundamental credit strategy at Deutsche Bank AG in London. “At this stage in the cycle, it is very difficult to raise capital.”
…
Banks repossessed twice as many homes in May as they did a year ago and foreclosure filings rose 48 percent, according to Realty Trac Inc., a real estate database in Irvine, California. Home prices in 20 U.S. metropolitan areas fell 15.3 percent in April by the most on record, the S&P/Case-Shiller home-price index shows.
“Trying to raise $75 billion in the current environment would be very difficult,” said Mark McCarthy, a credit trader at ABN Amro Holding NV in Sydney. “I don’t think investors are going to be as forthcoming about stumping up the cash that we’ve seen in the past.”
From Marketwatch
Wachovia slashes Merrill estimates, predicts $5B write-down
Merrill Lynch & Co. will write-down $5 billion for the second quarter, an analyst for Wachovia Corp. said Tuesday. Wachovia Corp. analyst Doug Sipkin also slashed his second quarter estimate for the bank to a loss of $2.16 a share, from a previous estimate of a per-share profit of 63 cents. Sipkin lowered his 2008 full-year estimate for the bank to a loss of $3.11 a share from a per-share profit of 15 cents.
But Merrill is probably hiring like crazy…
Big Ben on squak box later today should be fun.
BTW this is a strange recession. Broke down and took the kiddies to Mary Poppins on Saturday in the city. Theater sold out, side walks packed, restaurants had a wait to sit and I saw plenty a non tourist girl with a shopping bag from American girl at the play.
Housing is dead mainly because it is no longer cool or trendy to do. The lemmings who bought SUVS, five dollar cups of coffee and McMansions to show off in 2005 now are called idiots if they bought that stuff so they have stopped. If the stock market came roaring back the psycology will need to change. Remember the NYC Coop? Back in 1987/1988 every cocktail party was about insider deal/conversions and how coop fliping, well when that bubble burst in 1991/1992 the word coop became a four letter word for the rest of the 1990s regardless of the fact that the economy was doing great, rates were low and buying a coop was cheaper than renting. No one wanted them.
From Marketwatch
Bernanke: Fed needs powers to oversee money markets
Bernanke: New powers needed if Fed given job to stop turmoil
Bernanke: Fed should oversee payment, settlement system
Bernanke cautiously pushes for new powers for Fed
Bernanke: Fed mulling extending loans to brokers beyond 2008
Congrats Aaron, well deserved recognition!
Loan Pains Turned Site Into a Hit
The misery in the housing market is registering on the Implode-O-Meter.
As millions of homeowners fall behind on their mortgages, a fledging Web site called the Mortgage Lender Implode-O-Meter is gleefully tallying the number of lenders that run into trouble too. On Monday, the count was 265 — and rising.
With its tongue-in-cheek tone and running lists of the “imploded” and the merely “ailing,” the Implode-O-Meter has become a sort of Gawker of the subprime world. At a recent Mortgage Bankers Association conference, a speaker addressed what has become a hot topic among lenders: how to keep your company’s name off the site.
“No one wants to be number 266,” said Jim Reichbach, a vice chairman and leader of Deloitte’s banking and securities team. “This is a death toll that is equivalent to the casualty ticker of the Vietnam War.”
From MarketWatch:
IndyMac forbidden to make new loans
IndyMac Bancorp said that regulators have told the lender it isn’t “well capitalized” after failing to raise new capital, a move that raises tough questions about the troubled company’s viability.
Late Monday, the Pasadena, Calif.-based company said it has agreed to a new business plan with regulators which includes halting new mortgages to shrink its balance sheet and improve capital ratios. It will also cut 3,800 jobs, bringing staff levels to roughly 3,400.
IndyMac is also barred from accepting new brokered deposits unless it gets a waiver from the Federal Deposit Insurance Corp., a bank regulator that insures deposits. But the company said it’s not certain a waiver will be granted. Second-quarter losses may be larger than the first-quarter, the company also warned.
“Insured financial institutions don’t fail in the U.S., they go through an orderly unwinding process under the guidance of regulators, and I think that’s what we’re seeing with IndyMac,” said Fred Cannon, analyst with Keefe Bruyette & Woods, in an interview on Monday. “We do not expect IndyMac will be the last financial institution to go through this.”
“But Merrill is probably hiring like crazy…”
They are hiring aggressively, so is Citi, Pfizer, and ton of hedge funds.
From The Record
400 North Jerseyans getting pink slip
Four North Jersey companies have announced plans to lay off more than 400 workers in the coming months, including about 150 at a Jersey City office of Bank of America, state records show.
More details at the link above
From The Record
More paring for Linens ‘n Things
Linens ‘n Things Inc., the bankrupt housewares retailer, asked a judge for permission to close 87 more stores, which would shrink it to about two-thirds the size it was before seeking court protection from creditors in May.
The company cited “the decline in the housing market and the tightening of the credit markets which have led, respectively, to a decline in consumer discretionary spending,” in court papers filed July 3.
Huh? It’s as if not enough homes are selling and those that own aren’t buying “stuff”. Odd since RE is “on fire” in NJ…
“Frank, are you for real? ”
Tom,
Show me the price declines. Where are they? Can I buy a home in NJ for 2003 prices? Can I buy a condo in Hoboken for 2005 prices?
Get real Tom, people are still buying homes in NJ and paying top prices for them. Stop reading the negative stories, get out there and look around, homes are still selling in NJ. Prices have barely dropped.
They are hiring aggressively, so is Citi, Pfizer, and ton of hedge funds.
You left out Bank of America.
Has frank admitted what he does for a living?
I’m thinking recently unemployed.
Thanks Rich. Wow! I know it is not a perfect statistic but that looks like 1:1 sold/for sale ratio in 2004 that has ‘surprisingly’ moved to an almost 1:2 ratio in 2008. Hmmmph! tick…tick…tick
#84 Rich; Are these the same Wall St firms that frank said are hiring yesterday?
Clot, your comment remind me of the Marshal McLuhan moment from Annie Hall.
Frank,
Yes, you can buy a home at 2003 prices. Have you tried? Or are you only going by list price?
Show me data that homes are selling for top prices instead of your wishful opinion.
Prices have barely dropped.
When you take in inflation… oh wait, that’s right. You don’t understand inflation.
Whoa, you get calls from headhunters for financial sector jobs; see new hires walking the street and yet get the math on inflation wrong?
Is the hiring in janitorial services to assist in clearing out offices?
3B (101),
I figured it out. If they’re a Wall Street firm, they’re hiring.
FRANK:
Wanna buy my house? I’ll set a larded, what-*I*-think-it’s-worth, swing-from-the-heels, [no-metaphor-too-lazy-to-mix] price, but you should still have no problem flipping it for a healthy profit in Bergen Co.’s red-hot market.
Deal?
99:
And I’m thinking “perpetually unemployable.”
#98 NJpatient: frank and NNJ are realtors.
OK, if a town listed 200 homes in 2006 and all homes sold for around 500K that is not the same as if the town listed 200 homes in 2008 and the listings expired on 100 homes and only the best 100, right street, right school, good condition etc and the average was 500K. If you look at sales price alone you might say no big thing. But if you have a flawed house, no basement, no garage, bad location, poor condition etc. you could have got some sucker in 2006 to give you your price as their were flippers and people who just wanted to get on property ladder and figured they stick the next person in three years with that dog at a 200K profit. Well that is dead. Good homes priced right sell. But people with crap homes or who need full price to pay off their huge mortgage, well they are screwed.
#104 Rich: Cannot say too much, but I will be at meeting at Citi later today. Should I let them know that frank told me that Citi is hiring aggressively?
I could tell them to look at Merrill as they are hiring aggressively too.
After alll frank who does not work on the street, knows more than those that do.
holy eff! based on the name of the town i’d be surprised if there’s even a wawa nearby.
http://philadelphia.craigslist.org/rfs/745891783.html
Jamey (102)-
And, in housing, the medium is the message.
I have been looking to buy a place in Hoboken for a reasonable price for 4 years now, since I have sold it in 2004, thinking it was the top. Show me a place in Hoboken for 2004 prices.
3b (109)-
“Cannot say too much, but I will be at meeting at Citi later today.”
Don’t drink the water there. You may catch their disease.
#109,
I don’t make the stuff up.
“GTS are hiring though.”
http://dealbreaker.com/2008/07/bonuslayoffs_watch_08_citi.php#comments
#104 Rich: I think Wal-Mart’s broker dealer division is hiring
“Merrill Lynch & Co. will write-down $5 billion for the second quarter”
That CAN’T be true!! bi and S&P said there would be no more writedowns!
#114 frank: Did you actually read it? Or do you hsuffer from a rading comphrension problem?
2nd (110)-
But I bet there are five places within a 10-minute drive of that house where you can buy all the guns and ammo you can stuff into your car.
3b (117)-
Trollitis.
Grim, any of your friends that got let go yesterday interested in a f/t gig doing jde/1 wrld? shoot me an email if so.
Since when is something being “on fire” a good thing? House on fire? Car on fire? Yourself on fire?
Anyway, it appears that the job market continues to burn up.
N.J. drugmakers cut more than 1,100 jobs
New Jersey drugmakers have notified the state they plan to cut more than 1,100 jobs.
With sales of key products flagging, the biggest hits are from Schering-Plough, which plans to cut more than 500 jobs statewide, and Johnson & Johnson’s Ortho Biotech, which will shed 549 jobs in Bridgewater. In addition, Abbott Laboratories said it will trim 83 jobs in Parsippany.
Frank,
I can’t speak to Hoboken as I have no data.
You can’t speak to ALL of New Jersey Real Estate as you have no data.
But it sounds as if you timed the market in Hoboken wrong, can’t admit that to yourself and want everyone (and yourself) to believe that New Jersey Real Estate is still “on fire”.
If you were reading here for a long time you would know of the theory that the market expands out from NYC and contracts back towards NYC. Looks as if you’re going to have to kick yourself and wait it out.
And post 114, weak.
110. Actually familiar with that area. Nice but nowhere to work. Can you say Pottstown? Clot: ammo stores aplenty…
clot, for sure!
New Jersey Vulture Fund (NJVF) is hiring, but only if you have the ability to attract capital.
grim (125)-
Is debt the same thing as capital?
Just asking.
Of course, we’re practicing Orwellians.
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I can only find 2003 prices over by JC and Hoboken!
“N.J. drugmakers cut more than 1,100 jobs”
N.J. drugmakers are still hiring, friends are getting jobs with sick pay and benefits, 5 minutes from their home.
Even more outrageous is the fact my illegal neighbors are getting jobs with top pay, no income taxes, just cash.
So weeeeeeeeeeee
129
Sick pay as in how the kids use it? Man, that pay is sick!
Benefits? Free smokes?
I guess the corner is likely to be five minutes from their house.
Columbinas? Mexicans? Guatamalens? Of course they don’t pay taxes on G cash money.
Technically crack dealers are not drug makers, I believe they would fall into the distribution sector rather than manufacturing.
Hold tight wait till the partys over
Hold tight were in for nasty weather
There has got to be a way
Burning down the house
…
No visible means of support and you have not seen nuthin yet
Everythings stuck together
I dont know what you expect starring into the tv set
Fighting fire with fire
My local real estate market is confusing. Some units in good condition just don’t sell no matter what the asking price is. One unit in particular has been listed on and off since 2005 now. Other units of identical configuration list and sell quickly – but at widely divergent prices. 339k and 318k for two identical units in similar condition about two weeks apart. None of this makes any sense.
[129] turn your neighbors in. That’s American.
Yikes ! INDYMAC down 45%
#129 Say good night frank.
Welcome to $4 gas NJ.
AAA says NJ gasoline price exceeds $4 a gallon
AAA-New Jersey confirmed what most motorists already know: gasoline across the state is selling for more than $4 per gallon.
AAA announced today the Garden State had reached the milestone overnight.
[92]
“He recommends avoiding the stock”
Ya think?
from the weekend thread:
“In New Jersey, we have more such regulations than any state in the union. There are the Pinelands regs, the Highlands regs, the stream encroachment regs and so on.”
And, let us not forget the “other” regulation, which exists here in spades: the “how-much-do-I-need-to-pay-this-inspector-or-that-boqard-member-to-get-things-done-in-this-town regulation.” One runs the risk of not paying someone who requires it and not getting a project built or offering a payument to someone and then ending up in jail for atrtempting to bribe someone. If one can avoid this tightrope walk by building across the river, who can blame one for doing so.
# 136 Rising prices is good, no? I thought that is what Congress is trying to do, keep prices high, at least for RE.
Shore Guy #138,
With all this talk of going across the river, how is RE doing in the Lehigh Valley and the Poconos?
One would think it would be doing quite well. Is it?
# 131 Grim,
Feeling a bit of nolstalga for CBGB are we?
It was only a matter of time before Frank blamed the red hot job market on illegals.
From Marketwatch
U.S. May pending home sales index down 4.7%: NAR
Indymac is a screaming bargain, you get the stock for free when they pay their next dividend! (note: I’m being sarcastic, all disclaimers)
From MarketWatch:
Pending home sales index down 4.7% in May: NAR
In a sign that the U.S. housing market may weaken further, an index of sales contracts on previously owned U.S. homes fell 4.7% in May from the prior month, the National Association of Realtors reported Tuesday. The index, which is considered a leading indicator of existing home sales, was down 14% from the May 2007 level. By region, May’s pending home sales index fell 7.1% in the South, 6% in the Midwest, 2.9% in the Northeast and 1.3% in the West. The April pending home sales index was revised to a gain of 7.1% from the prior estimate of a 6.3% increase.
#136
But according to Greenspan, doesn’t paying more at the pump stimulate the economy? I remember him spewing some nonsense that rebuilding after the hurricanes in 05 was good for the economy becuase of the stimulus.
From MarketWatch
Pending home sales index down 4.7% in May: NAR
In a sign that the U.S. housing market may weaken further, an index of sales contracts on previously owned U.S. homes fell 4.7% in May (except HOT NJ) from the prior month, the National Association of Realtors reported Tuesday. The index, which is considered a leading indicator of existing home sales, was down 14% from the May 2007 level. By region, May’s pending home sales index fell 7.1% in the South, 6% in the Midwest, 2.9% in the Northeast (must be those OTHER NE states) and 1.3% in the West. The April pending home sales index was revised to a gain of 7.1% from the prior estimate of a 6.3% increase.
frank is the new duckie
Frank’s not completely off-base. I’ve been scoping out condos in Hoboken and you still can’t get a good 2-bedroom condo in North Hoboken for under $700K (it’s a different story in other parts of town).
The more desirable parts of Hoboken have definitely held their value. Neighbors in our building sold a 1-bedroom apartment a couple of months ago for $150K more than they paid for it.
[92]
I love how they disclose that they aren’t “well capitalized.” That is like saying the guy with the sucking chest wound “isn’t feeling well.”
This suggests that they are “critically undercapitalized” which is the lowest possible level. At that level, the regulators can order just about anything. Also, if they stopped payment on subordinated debt, that is one indication since sub debt payments must stop once the bank becomes crit undercapped.
I realize that this info, while educational, is kind of useless. Once you see the Titanic go vertical, you don’t need to be told it is sinking.
The sequel to #131:
This used to be real estate
Now it’s only fields and trees
http://www.youtube.com/watch?v=lOEIRI5HSuQ
#149 hobocondo: Give it time, Wall St layoffs will take care of the more desireable areas in Hoboken too.
#151 – nice choice
From Bloomberg:
Pending U.S. Home Resales Drop 4.7% in May, More Than Forecast
Americans signed fewer contracts to buy previously owned homes in May for a third month in four, a sign house prices have yet to touch bottom.
The index of pending home resales fell 4.7 percent, a bigger decline than forecast, after a revised 7.1 percent gain in April, the National Association of Realtors said today in Washington.
Would-be buyers are holding off purchases as they expect further price declines, and as rising mortgage rates and tougher lending standards make it harder to qualify for loans. Record delinquencies on home loans have led to concerns that Fannie Mae and Freddie Mac, the two biggest U.S. mortgage finance companies, may need to increase their capital by $75 billion.
“After a healthy bounce in April, the housing market appears to have lost steam again in May and June,” said Mike Larson, a housing analyst at Weiss Research in Jupiter, Florida. “Unless and until the economic clouds part, we’ll likely see the housing market continue to struggle.”
Economists had projected the index would fall 3 percent, according to the median forecast in a Bloomberg News survey of 38 economists. Estimates ranged from a drop of 6 percent to a 0.2 percent gain.
Pending resales were down 14 percent from May 2007, today’s report showed.
[147]
NAR predicts that housing will rise 4.3% in 2009… time to buy a house ASAP!
MAD MONEY BOND OF THE DAY!!!!!!!!!!!!!
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#98
either a realtor or gov’t employee
Mike,
https://njrereport.com/index.php/2008/04/09/tracking-realtor-spin/
One apartment we saw (non-waterfront) was going for $685K (2 bedrooms, about 1100 sf). New construction, but ridiculous asking price given its location and size. They did drop the price by $40K, and I stopped following the process, but the asking price was so way off base…
140 The difference is that the earlier discussion had to do with industrial and commercial RE, not residential. The LV was sold to suckers as a bedroom community of Nassau County; and in an area that, apparently, had no building codes, so the homes are falling apart.
The concerns about losing industrial facilities to less corrupt and less regulated environs is real and is important, regardless of what happens with residential RE markets in the respective areas.
A few weeks ago, I came and asked for some recommendations on places to live that were not Westfield, but affordable, and commutable to Newark.
Unfortunately, nothing panned out, and we put a deposit down on a place in Bucks County. Longer commute, but quality of life should go up dramatically in spite of that.
Fitting given yesterday’s title article.
“Give it time, Wall St layoffs will take care of the more desireable areas in Hoboken too.”
3b,
I have been waiting since 1999 for a price drops in Hoboken, so far only up and up. Looks like I will be waiting until I retire.
# 92 “IndyMac Bancorp said that regulators have told the lender it isn’t “well capitalized” after failing to raise new capital, a move that raises tough questions about the troubled company’s viability. ”
But didn’t the folks running the place put their assets into CDs? Good stable ones too, good for the long haul: Beatles, Stones, Springsteen, Mozart, B.B. King, Zep, etc.
month over month decline May vs April sales seems kind of brutal. Don’t want to make too much of one month’s data, but I wonder how often there has been a decline between these two months historically (instead of a rise). My impression was that seasonal sales activity peaked in June/July, rising pretty steadily from Feb.
This JUST has to hurt:
“Paul Miller, a Friedman, Billings, Ramsey analyst, cut his price target for Pasadena, California-based IndyMac to zero per share from $1.00.”
Seems like the perfect time for the “essential” execs to seek big bonuses.
http://www.cnbc.com/id/25581047
Hoboken will drop in 2009/2010. Most of Wall Street did pretty good bonus wise in Jan 2008. But it will be brutal in Jan 2009 and Jan 2010. Layoffs, low raises and very little bonus. That combined with the huge amount of new coops/condos being completed on wall street in the next two years will kill hoboken. If I can live in on wall Street for $600 a square foot why would I live in Hoboken? Just come downtown and work around and check out all the spec buildings going up. Too late to stop construction, these things are going to flood the market next year.
#162 franl Well you are foolish, real estate was fairly valued in 1999;you should have bought at that time.
# 162
Hoboken was such a pit for so long, I can see why one might be tempted to look for declines there. I suspect, though, that as long as the City stays healthy — and by this I mean low crime, clean, good place to spend a day, as opposed to the Abe Bean years — places like Hoboken will do pretty well. If not low level Wall Street types looking for an easy commute, then aging Boomers looking for a place that allows them to do the entertainment, cultural, and dining aspects of the City while not living there. Besides, the views are better from Jersey, and it is a shorter drive, or train ride to nice beaches in Jersey than out on the Island. Even aging Boomers like to walk along the beach holding hands now and then.
# 166 It sounds like Miami.
Does anyone have information on this house?
MLS ID# 2741389
Hackensack St, Wood Ridge
I’ve lived in this town for over 3 years now (renting) and this thing has been for sale since we arrived! They’re asking $619K for it – which explains why it’s still for sale – but I’m wondering what the original asking price was. Terrible location on a busy street and absolutely no land. I wouldn’t pay more than $300K for this thing.
mls#2047788
7 Drumlin Ln, Laurel Hollow, NY
-12.5% change from first recorded price
Asking Price $3.5M as of 07/02/2008
Asking Price $4M as of 02/14/2008
I love it when I see some “man sized” price cuts on non short sale or distressed properties. Just shows buyers are finally getting it. 500K+ to me is a nice “man sized” cut.
Hoboken is a living hell. Reminds me of Harlem, Long Island City, Astoria, Woodside, Staten Island etc. Whenever Manhattan (86 street to wall street) prices get sky high these nearby hell holes shoot up in price only to get crushed when Manhattan prices fall a bit. The carrnage will be horrific in Hoboken. In three years it will be crack central.
#168 shore Well Wall St has to be in a hiring mode, and they are not. And aging Booomers have to be ablr toi sell their SFH’s to younger people in order to do the city living thing.
The problem of course is the Wall st engine job is gone, which affects other professions in NYC, and NJ is losing tis high paying jobs.
Couple that with a recession, (or a national economic slow down if you prefer), much tighet credit, and stagnant wages for the people who are still employed, and want to buy a house, and prices have to fall;both for the aging boomers POS cape, and for the apartment he ro she wants to buy in Hoboken.
It really is that simple.
#108
“OK, if a town listed 200 homes in 2006 and all homes sold for around 500K that is not the same as if the town listed 200 homes in 2008”
yes, now it’s as if E500s are going for the same price as E350s. technically the same model is going for the same price, but the particulars are quite diff’t
Frank, are you caterwauling about Hoboken again? That town is somewhere around 80% rentals and Mob owned, why would you want to buy an 1100 sq ft concrete and steel box for 700k? So what you and the rest of the yuppies can have a dog walking competition, and not talk to each other while you try and out fart each other in the elevator?
Right now Hoboken is simply a birthing nest for the yuppies, once all those kids hit 5 yrs old it will be off to Ridgewood, Summit or Brigadoon.
#167,
I did buy it in 1999 then sold it in 2004, I am looking for 2003 prices to come back, looks like I will be waiting for a long time.
#175,
Who cares who lives there, as long as they pay rent on time unlike in Newark.
#166 John: lots of spec building in Lower Manhattan.
20 Pine Treet
15 Broad St
25 Brosd St
65 Wall St
75 Wall St
Various locations on John Street, and on and on. Almost all of these that I have mentioned have not even come on line yet.
Oh and I forgot all the lcoations on William St, the old insurance alley.
frank-
why do you want to move to hoboken again?
“why do you want to move to hoboken again?”
1. Because I hate my commute.
2. I want to buy a cash-flow positive rental
Grim/anyone who knows
I’m looking for info regarding a recent sale on Peublo Dr in Franklin lakes. Sale should have closed recently as new owners are moving in on Friday. wondering if it was more than 2 million…info not yet on any sales sites..this couple is buying this mega house before they put their other house up for sale because selling it while they still lived there would be too much of a “hassle”. That’s some good $$$ talking there.
Re #181..did I mention that this couple is still in their late 20’s/early 30’s..
#176 frank: I bet you you could find 2003 prices now in Hoboken.
After all who will be moving there, all those people being hired on Wall St?
150 Nom
“Once you see the Titanic go vertical, you don’t need to be told it is sinking.”
Maybe, but Frank would point out that a the prow of the boat is higher than it’s ever been before.
#183,
Stop all this blogging and show me a Hoboken property at 2003 prices. Come on, it should be easy, prices are down so much.
I’m not sure about living in downtown Manhattan. A friend of mine moved down there after 9/11 and has been suffering from bronchial problems ever since. She’s on Fulton St.
Hoboken is becoming a trap for many young couples. Many people who bought one or two bedrooms there during the ’03 to ’06 boom years now have children. They thought the two bedroom they bought would be big enough but now its apparent that they need much more space, not to mention a place to send their kids to school. With prices in many buildings off of the peak levels, they can no longer afford to sell and move to the ‘burbs where $700k at least gets you 3 bedrooms a basement for storing huge amounts of kids toys and a backyard. They are stuck and the kids are getting bigger.
162 frank
“I have been waiting since 1999 for a price drops in Hoboken”
Hmm. So you thought they would drop then and won’t drop now. Your foolishness is consistent. That’s why folks pay you little mind.
(Apologies to R.W. Emerson.)
You’re a better black box inversion than bi!
[184] NJP,
LOL! And he would be right (for a minute or so)
Still, even a busted clock is accurate 2x a day. Prices in Brigadoon are still remaining stubbornly high because there are still buyers willing to pay for it. So Frank may be right w/r/t some places, even as the rest of Jersey sinks around him.
172 john
“Hoboken is a living hell. Reminds me of Harlem, Long Island City, Astoria, Woodside, Staten Island etc. Whenever Manhattan (86 street to wall street) prices get sky high these nearby hell holes shoot up in price only to get crushed when Manhattan prices fall a bit. The carrnage will be horrific in Hoboken. In three years it will be crack central.”
Agree.
The thing with Hoboken is that we are getting a lot of people come in from Manhattan who are used to high prices and smaller spaces. My building is full of Manhattan transplants who want more for their money.
The other thing is that while Wall Street may be suffering, there are lots of people in Hoboken who don’t work on Wall Street – physicians, lawyers, professors. I know in my building, there are a decent proportion of people who have bought their condos with cash.
177 frank
“Who cares who lives there, as long as they pay rent on time unlike in Newark.”
I think that confirms what we already knew: you’re a RE agent who started buying properties. Kind of like the pusher who starts snorting his product.
In a couple of years, you’ll be huffing paint.
[165] Shore guy,
Maybe not. Once a bank is deemed significantly or critically undercapped by the feds, they can restrict exec comp. Mozilo got out just in time. If the feds had come in sooner and deemed the bank to be undercapitalized, they could have lowered the hammer on him. This is one reason you see bank execs head for the exits WTSHTF.
re: cash-flow positive rentals in Hoboken. Frank lets get realistic here, you are trying high dive into the pool but the problem is the pool is now full of concrete. Pick another market and stop caterwauling Hoboken has only 19k units and most properties are developed and owned by the corporations or the mobsters.
TOTAL OCCUPIED UNITS
19,418
Owner-occupied 4,396 22.6%
Renter-occupied 15,022 77.4%
#187 r – I don’t know anyone in the position you are talking about and I know a lot of people in Hoboken with kids. Hoboken is MORE expensive than what you can get in the suburbs. Not only that, but a lot of people are choosing to live in Hoboken.
Know how many times it has come up in discussion that we are thrilled it costs us less than $20 to commute to work on the Path when our suburban friends have to fill up their gas tanks 2x week at $75 each time?
Laurie,
SOLD: 860 PUEBLO DR $2,495,000 10/8/2004
Orig List: $3,799,000 5/30/2006
Last List: $2,999,000 12/18/2007
SOLD: $2,685,000 6/13/2008
Hobocondo, little Braden or Madison will not fare well in the Hoboken, as soon as they come home and start flashing gang signs mommy will freak out and buy a POS cape in Bergenfield.
“I think that confirms what we already knew: you’re a RE agent”
no even close, I am not an RE agent.
Show me a cash-flow positive condo in any other NJ town where the renters will leave the appliances after they move out.
HoboCondo (195),
Your opinion seems biased. Do you have any data (I know Frank wants some) of Hoboken sales other than anecdotal comments?
#197 Sean: and they will still be flashing those gang signs in Bergenfield.
189 Nom
“Prices in Brigadoon are still remaining stubbornly high”
True, still grossly overpriced, though by my non-scientific observation, ~10% lower asking prices than in early 2007.
SS,
139 HACKENSACK ST
Listed 3 times with 3 different brokers/agents
Orig. List: $725,000 4/6/2006
Last List: $619,000 5/5/2008
#195 what?
“a lot of people are choosing to live in Hoboken.”
virtually everyone not living in the projects chooses where they live. I believe r was saying that people who bought between 03-06 are now upside down and are unable to sell without a significant loss, hence they can not move.
198 frank
Then what do you do?
“Show me a cash-flow positive condo in any other NJ town where the renters will leave the appliances after they move out.”
Gee – I left the appliances in my rental when I moved out, but then again there are no condos out by me, which is one of the reasons I live where I do.
172:
Minus the race-baiting, John is totally spot-on about Mile-Square. Rising NYC rents drove me there; Hoboken’s inherent Hoboken-ness is what drove me back two years later.
Shore: Speaking from experience, being NEAR the attractions of NYC, but separated by the River Hudson, is like dying a few steps short of an oasis. The only topic left to debate is whether that’s comedy or tragedy.
Bernanke is one upping Congress before they take action.
Fed to Clamp Down on Exotic and Subprime Loans
By STEPHEN LABATON
Published: July 9, 2008
WASHINGTON — With no end in sight to the turbulence in the housing and financial markets, the chairman of the Federal Reserve said on Tuesday morning that it would issue new lending rules next week to restrict exotic mortgages and high-cost loans for people with weak credit.
Skip to next paragraph
Related
Text of Bernanke Speech
The chairman, Ben S. Bernanke, also said that the Fed was considering extending its program of low-cost overnight loans to the nation’s largest investment banks into next year. The lending program, which is supposed to be temporary, began in March in response to liquidity problems on Wall Street during the near-collapse of Bear Stearns, which was sold to JPMorgan Chase to avert going into bankruptcy.
At a forum in Arlington, Va., on lending for low- and moderate-income households, Mr. Bernanke said Bear Stearns’s difficulties had highlighted weaknesses in the financial system that policy makers were trying to address. He said they included poorly underwritten mortgages, regulatory gaps, tight credit and insufficiently capitalized financial institutions.
“The financial turmoil is ongoing, and our efforts today are concentrated on helping the financial system return to more normal functioning,” Mr. Bernanke said, according to an advance text of his speech issued by the Fed. “It is not too soon, however, to begin to think about the steps we might take to reduce the incidence and severity of future crises.”
Mr. Bernanke’s remarks appeared to have a reassuring effect on the markets, a day after shares of Fannie Mae and Freddie Mac, the mortgage financing giants, plunged amid renewed concerns that the worst of the mortgage crisis was yet to come. Shares of the two government-sponsored companies were up slightly in early trading Tuesday, while the major Wall Street stock indexes were flat, and European stocks cut their losses.
But new housing figures released Tuesday morning showed that the chill in the housing market was continuing. Pending home sales fell 4.7 percent in May, far more than expected, according to the National Association of Realtors. Compared to a year earlier, sales were down 14 percent.
In his remarks Tuesday morning, Mr. Bernanke repeated his support for overhauling the oversight of Fannie Mae and Freddie Mac. He and other senior government officials have expressed hope that the two companies can play a central role in helping to prop up the markets by providing billions of dollars of investments in mortgages.
“If these firms are strong, well-regulated, well-capitalized and focused on their mission, they will be better able to serve their function of increasing access to mortgage credit, without posing undue risks to the financial system or the taxpayer,” he said.
The decision to consider extending the Fed’s Wall Street credit program, which provides overnight loans to the 20 largest investment banks who serve as “primary dealers” and trade Treasury securities directly with the Fed, suggested that the Fed is coming to believe that the crisis that has been plaguing financial markets may spill into next year.
The lending program was originally set to last at least six months, through mid-September. It was established at the same time that officials were engineering the rescue of Bear Stearns after Fed officials concluded that credit markets had all but frozen, raising fears of widespread defaults on Wall Street.
Under federal law, the program can continue only if the Fed continues to determine there are “unusual and exigent circumstances” in the markets. The program allows the government to hold as collateral a wide variety of investments, including hard-to-sell securities backed by mortgages.
“Although short-term funding markets remain strained, they have improved somewhat since March,” Mr. Bernanke said, reflecting both the intervention of the Fed in offering loans to Wall Street and “ongoing efforts of financial firms to repair their balance sheets and increase their liquidity.”
The Federal Reserve is expected to announce new mortgage lending rules at a meeting on Monday. It is not known whether the Fed will significantly change the proposal it made last December, which provoked more than 5,000 letters, including heavy criticism from the mortgage industry and other parts of the housing industry.
Industry lobbyists maintained that at a time of tight credit, tougher rules could make many mortgages more expensive by creating more paperwork and potentially exposing lenders to more lawsuits. They also complained that the restrictions were too broad and would restrain lenders from issuing otherwise creditworthy loans. Three of the industry’s most influential trade groups — the American Bankers Association, the Mortgage Bankers Association and the Independent Community Bankers of America — separately filed letters criticizing the proposals.
On the other hand, consumer groups complained that the proposed rules would not be strong enough. They maintained that any efforts to further weaken the proposal would render it all but useless.
Mr. Bernanke said there would be changes to the original proposal in response to the letters that were sent to the Fed. But he did not specify them.
“These new rules, which will apply to all lenders and not just banks, will address some of the problems that have surfaced in recent years in mortgage lending, especially high-cost mortgage lending,” Mr. Bernanke said. “We received many helpful comments on our proposal and we incorporated a number of them into the final rules.”
The proposals were made after the Fed came under criticism for being captive to the lending industry and had failed over many years to supervise it adequately. They would not cover existing mortgages, but would apply only to new ones.
Under the proposal issued last December, mortgage companies would be required to show that customers could realistically afford their mortgages. Lenders would have to disclose hidden fees often rolled into interest payments. And certain types of advertising considered misleading would be prohibited.
As envisioned when the proposal was issued, the Fed sought to broadly apply special consumer protection to a far broader class of borrowers than it had previously. Under its existing rules, based on the Home Ownership Equity Protection Act of 1994, the Fed’s extra protections had originally applied to less than 1 percent of all mortgages — those with interest rates at least 8 percentage points above the prevailing rates on Treasury securities.
But the proposed new rules, by contrast, invoked broader legal authority to apply to any mortgage with an interest rate 3 percentage points or more above Treasury rates. Fed officials said that would cover all subprime loans, which accounted for about 25 percent of all mortgages last year, as well as many exotic mortgages — known in the industry as “Alt-A” loans — made to people with relatively good credit scores.
Industry lobbyists had complained that the definition was too broad and would sweep in many conventional kinds of loans, making them more expensive for borrowers.
Among those who argued that the proposals did not go far enough was Sheila C. Bair, the Republican head of the Federal Deposit Insurance Corporation and senior members of the House Financial Services Committee.
Ms. Bair proposed making it easier for borrowers to sue lenders by eliminating the proposed requirement that the borrowers would have to establish a pattern of abusive practices. She said that forcing borrowers to show a pattern of abuse “clearly favors lenders by limiting the number of individual consumer lawsuits and the ability of regulators to pursue individual violations.”
Ms. Bair also recommended that the Fed eliminate a so-called safe harbor provision in the proposal that protects lenders who fail to verify the income or assets of a borrower in some circumstances.
http://www.nytimes.com/2008/07/09/business/09housing.html?_r=2&hp&oref=slogin&oref=slogin
just got phone with Hoboken friend who just bought a unit by the marina near the pavonia mall in Newport and he confirmed it is going gang busters. However, to me that is a sign of a crash to come when people say everywhere is falling but it can’t happen here.
Frank,
STFU. Please, enough already. Contrarian thinking is helpful and welcome. The prevailing views on this blog were considered contrarian some time ago. However, the proponents of the that contrarian view offered evidence and data to back up their views. You offer sheer opinion occasionally backed up by dubious and sometimes outright fantastical anecdotes , then demand that we provide the evidence to prove you wrong. You have it exactly backwards. Why don’t you provide the evidence along with cogent analysis to back up your claims? Quit wasting your time here as your efforts will have no effect on market psychology. There must be a place were your ideas are encouraged and echoed, try there.
There is nothing wrong with contrarian thinking Frank, just back it up with some reasonable data, otherwise please STFU.
Hirono
184:
FTW! Oh, snap!
The appliances are not “parting gifts?”
What next? Are you going to tell me that taking the GFCIs from the walls or the light fixtures is off limits? Gimme a break!
Closter Comp Killer!
SOLD: 256 IRVING AVE $970,000 6/12/2006
Orig. List: $995,000 2/5/2008
SOLD: $950,000 7/7/2008
Post of the day:
Maybe, but Frank would point out that a the prow of the boat is higher than it’s ever been before.
Cresskill Comp Killer!
288 CONCORD ST $603,000 7/5/2005
Orig. List Price: $749,000 4/7/2006
SOLD: $585,000 7/1/2008
Look @ all the condos….
http://www.housingbubblebust.com/ConstructionBoom/NYC.html
frank Says:
July 8th, 2008 at 11:05 am
“why do you want to move to hoboken again?”
1. Because I hate my commute.
2. I want to buy a cash-flow positive rental
furts: Just FYI – I couldn’t find a cash flow positive rental in 1998, and it got worse from there. You also seem to be limiting your opportunity by a mental construct you have created.
I get into discussions with a lot of clients all the time about flexibility. The one issue crimping people is that they believe their lives must be a constant (perceived) movement up / more / better. There is a failure to view their lives and choices holistically. As a result, they tend to make major decisions in an incremental / on-the-margin / ad-hoc way. It is sub-optimal. Sometimes you have to take one, two, three steps backward so that you can resume your upward trajectory, or even end up four, six, ten steps ahead.
That said, I am constantly canvassing all manner of information sources, and I was rather distressed to find one resource that suggests that the pall cast over Manhattan is going to last roughly another 30 months. If so, let me tell you that in about 12-18 months, you will find the window of opportunity that may interest you.
Dumont Comp Killer!
62 DELONG AVE $435,000 4/30/2004
Orig. List: $519,000 8/15/2007
Last List: $449,000 5/1/2008
SOLD: $420,000 7/2/2008
Grim,
Where does Frank’s IP address resolve to? This should answer the realtor question once and for all.
Anyone have any idea what RE taxes would be like in Hoboken on a $700K apartment? Just wondering.
Templeton dead at 95
#202 – Thanks Rich.
Wow – $725 for that POS! I see absolutely no justification for that or the current price, unless maybe it’s sitting on oil reserves.
Where does Frank’s IP address resolve to? This should answer the realtor question once and for all.
Not quite, most offices use DSL, FIOS, or Cable with DHCP. Other than corporate hq, I doubt any branch or franchise is going to be using a static ip and their own domain.
#201 njpatient: And lots of inventory available last time I checked.
John (156)-
I have a better chance of meeting the Pope than seeing that bond mature at par.
#218
Sir JT is gone?
Richinnnj RE:181/196
Thanks for the info…next thing you’re gonna tell me is that is was an all cash sale…
Children of illegal aliens and up to thirty one year old “children” living in your basement and driving a BMW with no job now get Healthcare.
http://www.nj.com/hobokennow/index.ssf/2008/07/ramos_bill_moves_new_jersey_on.html#comments
“The bill also requires health insurance companies to allow young adults up to the age of 31 to sign up for coverage under their parents’ plan and will allow insurance plans to charge younger subscribers less, in order to encourage them to sign up.”
I had to read it to believe it. Young adults is 31? What does that make a 45 year old woman going through menopause? A slightly older young adult? Shoot me, now. Do it quick.
John Says:
July 8th, 2008 at 11:44 am
just got phone with Hoboken friend who just bought a unit by the marina near the pavonia mall in Newport and he confirmed it is going gang busters. However, to me that is a sign of a crash to come when people say everywhere is falling but it can’t happen here.
JJ: Are you sure that information isn’t tainted by a bunch of desi drinking the kool-aid? I can see the allure of wanting to live in that general vicinity given the demographics, but ultimately, I bet it is more than just a bit of a special case.
Pat (226)-
Hey, at least you don’t live here & have to pay for this mess of a welfare state.
John – Newport is the next Co-Op City, those that get in will find it very difficult to get out.
Re Hoboken – I think the new advertising slogan should be.
Why live in a commuting Hell when you can just move to Hell?
frank Says:
July 8th, 2008 at 11:05 am
“why do you want to move to hoboken again?”
1. Because I hate my commute.
2. I want to buy a cash-flow positive rental
John (230)-
“If you lived here, you’d be home now.”
At 15% interest you have 100% of your prinicpal back in six years. Bonds usually pay 30% or so in bankrupcty so you only need to make it to year four to hopefully break even. Once you break year six you have 15% a year until they go bankrupt and a long long shot they make it all the way to 2049 and you get back 100 cents on a dollar for a bond you bought at 90 cents on a dollar. I buy occassional 5K wild card bonds for my own portfolio to spare me the boredom of watching the rest of my vanila portfolio. Plus you can buy this bond even in 1K pieces which is only 900 bucks. A 900 buck investment that pays 120 bucks a year interest can fund three rub and a tugs a year.
Clotpoll Says:
July 8th, 2008 at 11:54 am
John (156)-
I have a better chance of meeting the Pope than seeing that bond mature at par.
Clot, nothing is ever as simple as it seems.
Because of an aspect of my career, this type of state law (regardless of state)could follow me where ever I hide, and create lots of clean up work.
How about “why be stuck in Newport eight hours a day when you can be stuck here 24 hours a day?”
“why enjoy the nightlife of NYC when you can look at it from across the river”
“Newport just one light train ride away from a bar open after eight pm?
“Pavonia Mall where you can dine at one of the last remaining Arbys in the world”
Actually I think you stole that from a condo in Greenwich Village.
Clotpoll Says:
July 8th, 2008 at 12:17 pm
John (230)-
“If you lived here, you’d be homo now.”
Arbys. Mmmmm. Do they still have that toppings bar with containers of goopy stuff to pour all over your fatty roast beef sandwich on a soft roll that gets so soggy the whole mess falls apart?
We need a caption contest for this picture- wow is he scary.
Send him over to the NAR to get the real data I say.
http://www.nzherald.co.nz/section/1/story.cfm?c_id=1&objectid=10520596
Taxes on a $769K condo we looked at were $10,200.
Rich (199), am I biased? I try not to be. I am in the market to buy a new condo, and I am not seeing prices go down in the more desirable buildings. I desperately want them to go down because I cannot fathom spending $769K for 2 bedrooms.
I have no desire for a house. I don’t need extra space to keep my “made in China” tsotckes because I don’t buy that junk. Kids’ toys and clothes get used at appropriate ages and then given away, not held on to for eternity. Adult clothes are culled every 6 months.
226 pat
You think those folks are reading young adult fiction? Paula Danziger?
John, I lived on Long Island for a few years and THAT was hell on earth.
You hate Hoboken, so we’re even.
Yes, I do.
That bill needs a rider. If 31 year-olds are granted automatic dependent eligibility, then they lose all rights to alcohol and tobacco consumption.
John (232)-
Is this your real area of expertise?:
“A 900 buck investment that pays 120 bucks a year interest can fund three rub and a tugs a year.”
You should try tax certificates. Even more fun than junk bonds!
Pat (233)-
In that case, I hope you have a good Tyvek suit.
kiwi (237)-
Looks like Eraserhead’s brother.
Painkillers and Coneheads: A National Crisis
Long Island is hell on earth if you have to leave the island to go to relatives or drive to work. A guy I work with from NJ always tell me he would hate to live in LI as it is so hard to get to NJ or upstate NY. I always ask him why would he be going to NJ or upstate NY if you work in NYC and live on LI? He didn’t know but he liked the thought he is able to do it. Kinda like my boring sister-in-law who lived in NYC and never went out but liked the fact if she did go out she could. I hate buses with a passion and all the good train towns in NJ are expensive so it makes no sense to move there. The final killer is the beach. I like to go and I hate long commutes. The two don’t mix well in NJ.
Also that 15% bond, NCC was investment grade, believe it or not!!
Hobocondo Says:
July 8th, 2008 at 12:31 pm
John, I lived on Long Island for a few years and THAT was hell on earth.
You hate Hoboken, so we’re even.
“why do you want to move to hoboken again?”
1. Because I hate my commute.
2. I want to buy a cash-flow positive rental
Simple solution: rent something in Hoboken
frank, if jobs are so plentiful, why not find one near where you live?
Ask the recruiters that call you what do they have in your town. Problem solved.
Obesity in China Doubled in 11 Years With Rising Prosperity
By Cristina Alesci
July 8 (Bloomberg) — Waistlines in China are expanding faster than almost anywhere else, with nearly a quarter of residents in the Earth’s most populous nation now overweight, according to a study.
Obesity among China’s 1.3 billion people doubled among women and tripled in men from 1989 to 2000, according to a study published today in the journal Health Affairs. China’s rising prosperity, which allows more people to afford meat, dairy foods, vegetable oils and sedentary living, is fueling the growth, the study said.
I am getting the urge to visit my back office in Jersey today. Frank are you and the other clerks around today?
John (246)-
“Also that 15% bond, NCC was investment grade, believe it or not!!”
So were a lot of SIV, CDO and CDO squareds.
The latest from Der Fuhrer, Dick Gaylord. I was hoping for a list of Congressmen that I can bribe, but this is what I get:
Dear Fellow REALTOR®:
I hope everyone had a very safe and enjoyable Fourth of July weekend.
By now, most of you are aware that NAR reached an agreement with the U.S. Department of Justice to settle the lawsuit over our Virtual Office Website (VOW) policy. I have received a lot of questions from agents and brokers about the settlement – what it means and when it will take effect.
We have just posted a new video edition of NAR President’s Podcast that explains the settlement in simple terms, and what you will need to do to comply when the agreement is finalized later this summer.
http://www.realtor.org/about_nar/presidents_report/_podcast_archive/presidents_podcast_doj_20080708
Please take just a few minutes to watch this video and visit realtor.org/DOJ for more information on how you can comply.
Thanks to all REALTORS® for your hard work to keep our businesses strong and the market competitive. Remember, there is nothing we can’t accomplish when we work “All Together.”
Gives new meaning to the term Stimulus Checks………….boooooooooooyaaa…..
http://news.yahoo.com/s/usnw/20080702/pl_usnw/president_bush_boosts_porn_industry_with_economic_stimulus_plan__according_to_aimrco&printer=1
grim unmod
I’m in Chemistry and have a good 30 people I know in the Pharmaceutical Industry. They aren’t on fire. In fact, they are all waiting to be fired.
1:02[JPM] Speculation not behind oil price gains recently : Dimon
1:00[JPM] Dimon calls for equal application of capital requirements
12:59[JPM] Dimon dismisses concept of “too big to fail”
from clot@252
Remember, there is nothing we can’t accomplish when we work “All Together.”
That’s to all those who questioned NJ Q1 sales.
From Yahoo:
Fed plans new rules to protect future homebuyers
The Federal Reserve will issue new rules next week aimed at protecting future homebuyers from dubious lending practices, its most sweeping response to a housing crisis that has propelled foreclosures to record highs.
To prevent a repeat of the current mortgage mess, Bernanke said the Fed will adopt rules cracking down on a range of shady lending practices that has burned many of the nation’s riskiest “subprime” borrowers — those with spotty credit or low incomes — who were hardest hit by the housing and credit debacles.
The plan, which will be voted on at a Fed board meeting on Monday, would apply to new loans made by thousands of lenders of all types, including banks and brokers.
Under the proposal unveiled last December, the rules would restrict lenders from penalizing risky borrowers who pay loans off early, require lenders to make sure these borrowers set aside money to pay for taxes and insurance and bar lenders from making loans without proof of a borrower’s income. It also would prohibit lenders from engaging in a pattern or practice of lending without considering a borrower’s ability to repay a home loan from sources other than the home’s value.
“These new rules … will address some of the problems that have surfaced in recent years in mortgage lending, especially high-cost mortgage lending,” Bernanke said.
Consumer groups have complained that the proposed rules aren’t strong enough, while mortgage lenders worry that they are too tough and could crimp customers’ choices.
hmmm…all energy related stocks seem to be taking a beating the past few days.
anyone know whats goin on over here?
ben, all in chemistry? anyone in IT?
Hobocondo (195) – You always mention your $20 commute but never discuss your monthly maintenance fee in your condo. I am sure that is more expensive then the commuter cost of a bus from say Leonia,no?
njpatient
True, still grossly overpriced, though by my non-scientific observation, ~10% lower asking prices than in early 2007.
———
I agree with your observation. But I think I am at least 10%-15% away from anything I have seen.
re: Jamie Dimon’s speech today at the FDIC meeting, he touched all bases from housing, mortgage, energy, derivatives to bank failures. The Investment banks could not ask for a better cheerleader right now.
FYI, He also touted Colonel Klink’s “Fed rescue/regulator plan” and said Congress should legislate consolidated supervision along the lines of the comments Bergabe made today.
A full court press and dog and pony show this week down in DC for Dodd and the rest of politicians to give the Fed extraordinary powers ASAP.
Bergabe and Colonel Klink will be visiting the Senate Banking Committee on Thursday to explain how they think financial regulations should be changed. Expect both to advocate a more explicit role for the Fed in trying to prevent financial crises.
Fox guarding the hen house anyone? anyone?
#260 – I work in IT for an IB. Ben’s statement is applicable here as well.
Victorian (259): “hmmm…all energy related stocks seem to be taking a beating the past few days.”
My take on it is that the bear market has been broad based with oil/energy as the only sector that has not suffered. For the start of 2008, it was the financials that many (including bi) thought had bottomed, but as you now know, that has not been the case. So essentially, it looks like long gold or short the overall market was the only real money making play.
There’s a great article on bear markets in this week’s Barrons that look at the history of bear markets focusing on their duration and amount of change.
http://online.barrons.com/public/article/SB121512473043028031.html?mod=9_0031_b_this_weeks_magazine_main
the truth is, all but the most obscenely expensive areas in the entire tri-state region are pretty crappy.
#260 NNJ,
couldn’t tell ya about IT. Most of the professionals that I go/went to school with that I talk to are in Chemistry, Chemical Engineering, Pharmaceutical Engineering etc… Most have PhDs or Masters Degrees. Talking to my students, entry level in Pharmaceuticals is in the pits too.
.. and even within those magical neighborhoods, 50% of the streets are borderline freeways.
And on the good streets in the good towns, half of the houses are inhabited by someone’s grandmother who hasn’t renoved a thing in 25 yrs (but still wants $1.1M for the place)
#263 sean
It’s too funny isn’t it. The people who claim that can’t see bubbles until after they have collapsed are the same ones who want more powers to regulate.
Bonkers
Stu (266) –
My thought process –
Part of the reason for this recession is the high cost of energy. Now, since oil has become so expensive and there doesnt seem to be any short term solution forthcoming, it would seem that companies which are engaged in oil exploration/oil field services would benefit from this.
I guess that judging from the spectacular run-up in most of these stocks, they have already benefited. I am thinking that this is profit-taking time.
Which areas do you think would be looking up in the next year or so??
My common sense tells me – Rail Transport, Alternative Energy, Energy Related Services.
As always, thanks for your input.
Forgot to add pawn shops to that list :).
(261) – Good point. The condo fee in my building is about 47 cents per square foot – so an 850-square foot 1-bedroom condo fee is about $400 per month (roughly).
Not cheap, but includes access to a giant gym (which alone can cost $60-$80 at a ‘public’ gym), doorman and other amenities. Keep in mind that this is a condo fee for a building with a lot of amenities – my friends’ fees in buildings with no amenities can be quite a bit less.
When I consider the amount of money (and/or time) I’d need to spend on landscaping and maintenance if I had a yard and general household maintenance, I consider maintenance fees a wash.
Russia vows military action vs U.S. missile shield: reports
[218] Grim,
Wow, Sir John gone. No doubt he went out with his middle digit extended toward the direction of IRS headquarters. Had he not expatriated well before the democratic exit taxes went into effect, the IRS would have cashed in mightily on the estate. Now they get nothing.
It is called “deadweight loss” when you tax something so much, you actually collect less taxes as a result of behavior change. Some have estimated that the IRS lost 100 million as a result of Sir John’s expatriation.
victorian 270
add fertilizer corps to the list
HoboCondo (238),
I thought from your comments at 195 that you owned.
Mea culpa.
I was wrong.
#259 Victorian,
I wouldn’t call it a beating. Look where they were 2 months ago.
It’s kinda like when people on CNBC talk about how we “beat oil back down to $130”. It’s a play on words. Oil was $80 before my last haircut.
No, you’re fine, Rich. I actually DO own! But would like to buy a larger apartment.
(272) I heard in some condo buildings in Hoboken you need to pay for pool access separately it is not included in the maintenance cost. Have you heard similar things?
River Edge Comp Killer!
179 MOHAWK DR $499,000 11/1/2004
Orig. List:
Last List:
SOLD:
hirono,
My view is not contrarian; it is common knowledge that RE prices have barely declined in NJ.
This blog wants you to believe that you can buy a home for 2003 price, think again.
Want hard evidence? Look at the report from Radar Logic Inc.
http://www.bloomberg.com/apps/news?pid=20601110&sid=aUKNXKCNLhGA
Prices in the New York area fell 3 percent from April 2007, according to Radar Logic.
Want other evidence? Go out and try to buy a home today.
Ooops!
River Edge Comp Killer!
179 MOHAWK DR $499,000 11/1/2004
Orig. List: $579,000 9/13/2007
Last List: $519,000 3/25/2008
SOLD: $490,000 7/3/2008
kettle (275) –
“add fertilizer corps to the list”
Would you mind elaborating?? – do you mean, that we would now try to grow food all year – round? I thought that in the long run, this damages the quality of the soil so much as to render it unusable?
Actually, maybe add companies which are into genetically modifying seeds to give higher yields.
Frank,
Who on this blog said that prices HAVE declined to 2003?!
To state that you can’t get a home priced at 2003 prices is assine.
You tried to time the market and failed. Deal with it.
Prices ARE declining and, in my opinion will continue to decline.
Hot market and on fire? You’re an ass.
Rutherford Comp Killer!
SOLD: 29 CARLTON PL $575,000 7/31/2006
Orig List: $629,000 4/20/2008
Last List: $599,000 5/21/2008
SOLD: $560,000 7/3/2008
Victorian:
It is always much harder to see something in a crystal ball than it is to look in the rear view mirror.
From my perspective, I expect to see commercial real estate pain and a lot of it. I’m a pretty solid bear and so far have played my cards correctly (long SRS in taxable account/bonds n the 401K/IRA). Of course, timing the buy of a stock is so much easier than timing the sell. At some point, I will once again go long and I look forward to it greatly.
If I were you, I would wait on the sidelines for a while. If the market rebounds a bit (15% or so), then go find something to short. If it continues to drop, then go long. Then be very patient.
One play I’m considering is shorting oil, but not before I see $155-$175. Too much risk to the upside with Bush in office and Iran playing games with him. The Chinese bull (as well as the Indian) has all but disappeared and I have a feeling that this was the main driver in the recent peak oil pop.
http://finance.yahoo.com/echarts?s=000001.SS#chart2:symbol=000001.ss;range=5y;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined
There is an awful lot of speculation going on with the price of oil and where there is speculation, there is often a precipitous drop in the future. One thing that is certain is that oil should not have doubled as quickly as it has even with the destruction of the dollar. We will find equilibrium. The question is will it be next week, next month, next year or next decade.
Ultimately, the overall market has been trading within a 25% range for the last 2 years. Unless you plan to trade the range (not something I believe in or do), you may be best off waiting. Ultimately, mitigate your risk through diversification if you can’t stomach the volatility. And stay away from gold for now. If it drops to $750 and the economy still blows, then and only then would I consider it.
Disclaimer: I have an advanced degree in teaching woodshop. If you need some help with cabinetry, then I’m the man. For financial matters, stick with a professional.
283 vic,
no i mean energy and fertilizer are tied together as fertilizer uses significant amount of energy in its manufacture and as a feed stock. see here for more
http://www.maldream.blogspot.com
I am not suggesting we grow year round, but there will be increaing pressures on food/ fertilizer from biofuels as oil continues to become more expensive.
Ben (#267),
Englewood FUTURE Comp Killer!
SOLD: 89 BROOK AVE $399,900 4/26/2005
MLS#: 2827948
List: $349,900 7/7/2008
Ben (#267),
Everyone in IT (in fact, in all departments)at Schering Plough is waiting to be laid off and their jobs outsourced.
Hard working loyal employees (many with MBAs) waiting to be “terminated”. Noone expects to find similar jobs in NJ ever again.
Where to go? What to do?
Here’s a link to the thousands of pharmaceutical jobs lost.
http://www.pharmalot.com/2008/04/where-the-jobs-arent-the-latest-layoff-tally/
re: #286 shorting oil – Stu there was this fella named “bi” who used to visit this board and he talked a big tale about $40 oil, don’t become the next “bi”, your wife won’t want to keep you if you drop the college fund on an oil bet.
Norwood FUTURE Comp Killer!
SOLD: 48 FAIRWAY TER $1,450,000 7/28/2004
MLS#: 2827914
List: $1,449,000 7/7/2008
Stu(286) –
Thanks for all the great info. Much Appreciated.
frank Says:
July 8th, 2008 at 2:16 pm
hirono,
My view is not contrarian; it is common knowledge that RE prices have barely declined in NJ.
furts: mix?
Ridgewood FUTURE Comp Killer!
SOLD: 110 S MAPLE AVE $829,000 1/5/2006
MLS#: 2827570
Orig. List: $1,100,000 9/18/2007
Last List: $749,900 7/3/2008
Frank,
I can prove that 2004 and 2003 prices are here. And not in the ghetto. I just wish i post the pretty graphs I’ve created in excel. I exported data from the MLS for Basking Ridge (Somerset county’s Brigadoon) 1BD 1Bth condos since 2000, and the average sales prices are at 2004 levels. And dropping. You can email me if you want the raw data.
And if I had access to Hoboken’s MLS, I’m sure I could provide the damn data you keep demanding too.
Mr. Furter:
extreme example…..
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aePySgcg3hXg
Gains continued in the first quarter, according to today’s broker reports. The Corcoran Group said the median for condos and co-ops rose 9 percent to $917,000. Terra Holdings LLC, which owns brokers Brown Harris Stevens and Halstead Property LLC, said the median climbed 13 percent to $855,000. The numbers vary in part because each broker includes some of its own sales that have yet to show up in the city’s public records database.
About 30 percent of all first-quarter closings were for apartments in new developments that went into contract before turmoil hit the credit market, said Gregory Heym, chief economist for Terra Holdings.
Teaneck FUTURE Comp Killer!
SOLD: 562 GRANT TER $350,000 11/19/2007
MLS#: 2827958
Orig. List: $355,000 1/30/2008
Last List: $310,000 7/7/2008
140 syncmaster,
I was at my bro.’s in Easton on Sunday. The Morning Call ran an article on how the NJ/NY transplant pipeline has dried up and now high gas prices are forcing people to move closer to work (and church?..apparently a big issue for NE PA)..or back to NJ. Still, I did not notice large numbers of for sale signs in the neighborhood. I think the market is ok. Special props to the area for best fireworks availability ever (Phanton and TNT warehouses). We lit off a couple of Bear claws..unbelievable!
Sean (263)-
“Fox guarding the hen house anyone? anyone?”
The metaphor I’d use would be locking a drunk into a Motel 6 room for the weekend with a carton of Marlboros and a case of Stoli.
My view is not contrarian; it is common knowledge that RE prices have barely declined in NJ.
This blog wants you to believe that you can buy a home for 2003 price, think again.
Depends on where you are looking. In some places I’ve looked in the burbs, prices are falling off a cliff.
If you think that gold is headed for $500/ounce, do you whine and complain that you can’t buy it for $500/ounce now?
Want hard evidence? Look at the report from Radar Logic Inc.
http://www.bloomberg.com/apps/news?pid=20601110&sid=aUKNXKCNLhGA
Prices in the New York area fell 3 percent from April 2007, according to Radar Logic.
And yet the CS index shows it has declined 8.85% YoY. Add inflation, and it’s over 11%.
https://njrereport.com/index.php/2008/06/24/new-jersey-home-price-tracker-june-2008/
vodka (275)-
Careful with the fertilizer plays. Fertilizer production uses huge amounts of natural gas.
Vic (283)-
Don’t be surprised to find that overcropping/overfertilization leads to a 21st century Dust Bowl.
Speaking of other spooky parallels to the Depression…
grim,
#299 in moderation
Allendale FUTURE Comp Killer!
SOLD: 45 CARTERET RD $1,205,000 8/29/2005
MLS#: 2815829
Orig. List: $1,149,000 4/18/2008
Last List: $1,099,000 7/7/2008
Stu (286)-
I can’t get short enough. Hell, I’m on the edge of being 100% short, with only a smattering of gold/mineral/steel.
Now, I can’t get a decent supply of certain stocks in order to sell them short the way I want. Thank God for DOG, SKF, SDS, etc.
I would like to get long something, with the idea of hanging on 12 months. When I look out 12 months from today, I just get the willies. Got any ideas?
And if I had access to Hoboken’s MLS, I’m sure I could provide the damn data you keep demanding too.
Actually, he’s correct that prices here haven’t really fallen. Prices in Hoboken will fall when prices in Manhattan fall.
stander (297)-
The Easton/Allentown/Bethlehem market sucks eggs. Believe it.
I have a client right now jamming a whopper of a lowball down the throat of a desperate bagholder in Forks Twp. What a nice house…in a development where there are another five for sale just like it.
Can’t give you any plays Clot, but today is turning out to be a bad day to be short :(
Stu (306)-
I prefer to call them opportunities to get further short.
Asking prices vs. selling prices. That’s the question I want answered for Hoboken.
This is just laughable
Harrington Park
ACT 162 SCHRAALENBURGH RD $799,000 3/20/2006
PCH 162 SCHRAALENBURGH RD $749,000 4/4/2006
PCH 162 SCHRAALENBURGH RD $699,000 4/25/2006
ACT 162 SCHRAALENBURGH RD $699,000 10/16/2006
PCH 162 SCHRAALENBURGH RD $649,000 10/30/2006
PCH 162 SCHRAALENBURGH RD $589,000 12/4/2006
ACT 162 SCHRAALENBURGH RD $569,900 2/12/2008
PCH 162 SCHRAALENBURGH RD $559,900 2/25/2008 PCH 162 SCHRAALENBURGH RD $558,900 3/8/2008
PCH 162 SCHRAALENBURGH RD $549,900 3/21/2008
PCH 162 SCHRAALENBURGH RD $548,900 4/5/2008
PCH 162 SCHRAALENBURGH RD $546,900 4/8/2008
PCH 162 SCHRAALENBURGH RD $544,000 4/17/2008
PCH 162 SCHRAALENBURGH RD $542,000 4/26/2008
PCH 162 SCHRAALENBURGH RD $541,000 5/7/2008
PCH 162 SCHRAALENBURGH RD $540,000 5/23/2008
PCH 162 SCHRAALENBURGH RD $539,000 6/10/2008
PCH 162 SCHRAALENBURGH RD $538,000 7/7/2008
I work in the Telecommunications as well as information technology fields and have family/friends in the Telecommunications/IT industry in and around the Metro DC area.
I haven’t heard of anyone losing thier job due to the economic downturn. I have heard of more 10 hour days, 4 day work-weeks tied with telecommuting.
I can’t say much for new faces though.
Not tooting Telcommunications/IT horns but I would imagine that with increased fuel cost that companies that provide communications services and infrastructure would seem to do better especially if they are providing services that allow people to travel less.
Video-conferencing, as an example, is a good subsitute for face-to-face meetings facilitated by costly air/car travel.
Foreign countries also want Telecom services to compete with the US (Cellular and Fiber Optic services) and a lot of talent exist in US for those services and is getting cheaper with the falling dollar as opposed to the EU experts that are becomming more expensive.
Thats my take on why I am not seeing losses in the Telcom / IT industry.
Majority of Brigadoon listings still overpriced, but not as many, and not by as much, as 2005 – ’07. Slow progress.
There may be an occasional sale approaching 2004 comps, especially on the 30+ DOM listings, but this is just a hunch.
Maywood FUTURE Comp Killer!
SOLD: 49 GROVE AVE $348,000 7/21/2005
MLS#: 2734278
Orig. List: $399,000 2/7/2006
Last List: $309,900 7/7/2008
I hear ya Clot. It takes a strong will to remain short when there are so few shares to short. Short covering rallies blow. At one point, I was down a couple BMW’s in SRS, but since then am up a few Mercedes.
I have noticed that everytime Bergabe opens his trap, I usually loose a Hyundai!
Oakland FUTURE Comp Killer!
SOLD: 84 THACKERAY RD $610,000 4/8/2005
MLS#: 2816973
Orig. List: $635,000 3/23/2007
Last List: $549,900 7/7/2008
Let’s see what the last 1/2 hour of the market brings. In 2008, so many times, the day’s gains get wiped out in the last half an hour.
twice,
It’s tougher to do the same analysis on the SFH’s that are common in Brigadoon since there are many differences home to home and the trendlines become noisy as a result.
That’s what’s nice about trending condos, since so many units are so similar, the trendline is fairly clean.
So do you all think that the T. Boone Pickens media blast is what is causing this mini rally?
Or the short-term drop in oil?
Nicholas,
From ’96 – ’01, I worked in IT/Telecom around the Dulles corridor. There was nothing left by ’02. Did it ever truly recover from the first bubble burst? I don’t know anyone who stayed in Telecom after that debacle.
Asking prices vs. selling prices. That’s the question I want answered for Hoboken.
Couldn’t tell you. I suspect it’s more or less the same as Manhattan. Discounts from asking price edging up slightly, but still not huge.
Westwood FUTURE Comp Killer!
SOLD: 2 BENSON AVE $585,000 4/6/2006
MLS#: 2821254
Orig List: $639,000 8/10/2007
Last List: $517,700 7/3/2008
The stock market is sporting a gain of more than 1% following the broad-based rally that was led by financials (+4.3%).
Must mean the word has spread that the $300 billion bank bailout bill is back on track.
Now I’m really pissed:
Just got a prelim HUD-1 on an upcoming REO closing (seller, Fannie Mae). In reviewing it, I noticed there was no NJ RE transfer tax.
When I called the title company, they informed me that the GSEs are exempt from paying this tax. Not…one…penny.
Think FNM and FRE aren’t bankruptcy vehicles, pre-primed for detonation? Let’s see:
– exempt from adherence to accounting standards
– exempt from capital reserve requirements
– exempt from even cursory oversight
– exempt from paying taxes on the sales of their f-ups
What other conclusion can be drawn?
I graduated in 2003 with a Bachelors in Electrical Engineering focusing in Communications and Signal Processing. Couldn’t buy a job with no industry experience so I focused my efforts on a Masters degree. I think doubling down was probably the smartest move at that point.
In 2003 the industry hit so hard by the .com bubble that they were putting out of work the guys with Masters and Doctorate degrees.
Problem was that it was just a huge game of musical chairs. During the .com run up the military and defense sectors had a very hard time holding onto talent because they paid less. Just seemed like water sloshing in a bucket to me.
The non-talented Telcom/IT bodies were driven out of the market after the bubble. As far as I can see job market is good for talented IT professionals around DC.
The whole situation reminds me of the RE agent run up during the housing bubble period too. Once the excess of RE agents are driven out of the buisness then those left will have a strong position on which to build.
Demand for talented RE agents is probably at an all-time high right now. Problem is you need to make yourself stand out among throngs of second-rate RE agents.
Nicholas, I was just about to say the same thing when bystander beat me to the punch.
There’s no fat left to cut in telecom.
Can someone please ring the closing bell already!!!
I’m dying over hear ;)
Uh, Stu, that’s Ovaheah.
I even lost the ability to spell! Hear is here.
sheesh.
It was the Dukes it was the Dukes.
Stu (329)-
You’ll never get an entry point on SKF like this one again!
Buy! Buy! Buy!
All disclaimers. The only double short my wife understands is a bolo punch…in the direction of my shorts.
clott,275
i know about the natural gas issues, i wrote a whole post that covered that on my blog. oil natural gas are a wild ride right now. thanks for the thought though
vodka (334)-
An upchuck-inducing wild ride…
Clot… I hearya loud and clear. This was a hell of a rally in the financials and the earnings season opens today! I expect tons of volatility over the next month with so many traders on vacation. Should be a wild ride.
Telecomuting to work is plain stupid. Out on Long Island a few weeks ago the unions wanted to go to a four day work week to save gas. Tom Souzi (who is an up and coming, may be governor one day)said that sounds great, all he needs is for the workers to sign a form saying they will not operate a motor vehicle or use public transportation on the day fifth day. He said if people drive to work one less day and then use that day off to go to beach, play golf run errands how the heck does that save fuel? Good Point.
Second point I had today myself, a staff person brought up the topic and said if she could work from home it would save her a three hour round trip every day and she would be more productive. I said that sounds great. So instead of the eight hours of work you give me in the office you will work 11 hours at home. She said of course not, I can use that three hours each day to do my own thing. Well I for one don’t see how that helps the company productivity wise or the economy fuel wise if she is going to use that three hours to drive around on errands.
clott,
we all know my stance on energy, but any real drop in oil is an opportunity for me to buy more.
next time we meet at a GTG ask me about morocco and i might have an interesting story for you regarding political strife and markets
Maybe so Bystander and Pat.
I just moved back to this area a little over a year ago and went searching for a job.
After a brief search I landed three interviews. Those three interviews yielded two job offers.
I have a brother-in-law in IT who does network administration. After 2004 his salary more then doubled due to the lack of talent in his field.
These are the specific examples that I can give but from an industry perspective I think that telcom is doing ok around the area.
John (337)-
The solution is to put your employee under caged surveillance within her home.
Maybe you can work in some of the new shock bracelet technology to get her to really get off her fat, lazy a## and perform. :)
vodka (338)-
“…next time we meet at a GTG ask me about morocco and i might have an interesting story for you regarding political strife and markets”
Can you also direct me to some good places to eat and smoke hash in Marrakesh?
“Are you telling me that with everything that’s going on in the RE market, 2,889 homes still sold?”
i think I kind of agree with this bloke.
I thought sales would be worse.
2889 houses sold out of how many that were on the market in bergen county?
what’s the % of houses sold that were on the market? 20%? 5?
Clot, do you realize how many Johns there are who have clawed their way into mgmt?
Don’t be giving these types any ideas.
John, we luv ya, babe. Keep up the good work.
Sybarite,
Right. More art than science. I’ll take a 2004 SFH comp or close to it in Westfield or Cranford if I can find it.
sorry clott, cant help you.
lets just say that a well timed action could throw some aspects of world markets into serious disarray
Does anyone have the address/history on this property? If I remember, this was a short sale a year or so ago. Wonder why it is back on the market so quick if it is the same one:
MLS Number: 2545638
ARLINGTON, Va (Reuters) – U.S. Treasury Secretary Henry Paulson said on Tuesday that home foreclosure starts may hit 2.5 million this year, many of them the borrowers’ own fault for taking out loans they couldn’t afford.
“There is little public policy-makers can, or should, do to compensate for untenable financial decisions,” Paulson told a forum on mortgage lending to low and medium-income homeowners.
He said flatter sales of existing homes in recent months implied some stabilizing in home-buying demand but warned foreclosures stemming from a housing correction that began in 2006 likely will continue for some time.
[337] John,
I can’t tell if your serious about your telecommuting statements but just in case you are those two arguments are probably the weakest I have heard in opposition to telecommuting.
Telecommuting keeps one more body/car off of congestion clogged roads. With less cars on the road *everyone* on the road saves gas. Cars are most efficient between 40-60 mph (range where most hit peak efficiency). Consider adding 1-2 mpg to the 100’s of other people that don’t have to compete with you for road space.
Your commute time is not “company time” or the company would pay you for it. By reducing commute time you are directly increasing productivity because happy workers produce better product, period. Grid-locked commute makes me angry and hate work. Help me reclaim some of my wasted commute time and I will be a happier worker.
There is so much that can be done outside the office that telecommuting can facilitate. Non-essential items such as documentation or rigorous paperwork could be piled into a day where telecommuting makes sense.
Obviously telecommuting is not for everyone.
Can I telecommute to the next GTG?
Speaking of getting people off the roads..this is perfect. This one is for Frank, courtesy of the Onion.
Report: 98 Percent Of U.S. Commuters Favor Public Transportation For Others
WASHINGTON, DC–A study released Monday by the American Public Transportation Association reveals that 98 percent of Americans support the use of mass transit by others.
“With traffic congestion, pollution, and oil shortages all getting worse, now is the time to shift to affordable, efficient public transportation,” APTA director Howard Collier said. “Fortunately, as this report shows, Americans have finally recognized the need for everyone else to do exactly that.”
Of the study’s 5,200 participants, 44 percent cited faster commutes as the primary reason to expand public transportation, followed closely by shorter lines at the gas station. Environmental and energy concerns ranked a distant third and fourth, respectively.
Anaheim, CA, resident Lance Holland, who drives 80 miles a day to his job in downtown Los Angeles, was among the proponents of public transit.
“Expanding mass transit isn’t just a good idea, it’s a necessity,” Holland said. “My drive to work is unbelievable. I spend more than two hours stuck in 12 lanes of traffic. It’s about time somebody did something to get some of these other cars off the road.”
Public support for mass transit will naturally lead to its expansion and improvement, Los Angeles County Metropolitan Transportation Authority officials said.
“With everyone behind it, we’ll be able to expand bus routes, create park-and-ride programs, and build entire new Metrolink commuter-rail lines,” LACMTA president Howard Sager said. “It’s almost a shame I don’t know anyone who will be using these new services.”
Sager said he expects wide-scale expansion of safe, efficient, and economical mass-transit systems to reduce traffic congestion in all major metropolitan areas in the coming decades.
Morning rush hour on one of Los Angeles’ economical, environmentally friendly buses.
“Improving public transportation will do a great deal of good, creating jobs, revitalizing downtown areas, and reducing pollution,” Sager said. “It also means a lot to me personally, as it should cut 20 to 25 minutes off my morning drive.”
The APTA study also noted that of the 98 percent of Americans who drive to work, 94 percent are the sole occupant of their automobile.
“When public transportation is not practical, commuters should at least be carpooling,” Collier said. “Most people, unlike me, probably work near someone they know and don’t need to be driving alone.”
Collier said he hopes the study serves as a wake-up call to Americans. In conjunction with its release, the APTA is kicking off a campaign to promote mass transit with the slogan, “Take The Bus… I’ll Be Glad You Did.”
The campaign is intended to de-emphasize the inconvenience and social stigma associated with using public transportation, focusing instead on the positives. Among these positives: the health benefits of getting fresh air while waiting at the bus stop, the chance to meet interesting people from a diverse array of low-paying service-sector jobs, and the opportunity to learn new languages by reading subway ads written in Spanish.
“People need to realize that public transportation isn’t just for some poor sucker to take to work,” Collier said. “He should also be taking it to the shopping mall, the supermarket, and the laundromat.”
Stu Says:
July 8th, 2008 at 3:21 pm
I hear ya Clot. It takes a strong will to remain short when there are so few shares to short. Short covering rallies blow. At one point, I was down a couple BMW’s in SRS, but since then am up a few Mercedes.
I have noticed that everytime Bergabe opens his trap, I usually loose a Hyundai!
GUYS: WTF are you doing….stop screwing around, and worse, coming here and talking up your book of noxious crap…seriously…the market at this juncture is a g-ddamned binary….look at the price of oil and take the inverse of the movement to map the indeces….you want to f— around with where these instruments are going, then you better fundamentally understand how these idiosyncratic metrics work…..taking risk is fine, taking a risk and not realizing you are taking a different risk is f-ing stupid….
ALL BUSINESS: Wall Street CEOs should return pay
http://ap.google.com/article/ALeqM5gca54s0LCP-1CIz0sSK5QWjOCzbgD91PRK5G0
ChiFi:
Need some cabinetry advice?
Point well taken.
So instead of the eight hours of work you give me in the office you will work 11 hours at home.
why would she?? so if her commute had been 6,7,8 hours you’d want her to work 14,15,16 hours. meanwhile her pay is based on 8 hours. I can’t believe how stupid you are.
Actually at DTCC back in the early 90’s the data entry area was located in 55 water street in the sub-basement, with no windows or pictures on the wall. The typists were not allowed PC screens and worked on keyboards with the letters/numbers removed. Looking up at the screen or keyboard distracts the worker. In addition they worked using a footmouse as lifting your hand to use a mouse slows you down. In addition, they weree not allowed desks with drawers, personal items in the room or are allowed to talk. Bathroom breaks are assigned and at the rear of the room sits the supervisor who monitors WPMS on his screen as well as a sample of output on a random basis for accuracy. Each employee was allowed a maximun of ten minutes a day of phone calls that took place at the supervisors desk while he montiored the call. Plus clocks were prohibited as well as suit jackets or shirts with pockets to prevent stealing of coupons from certificates. Employees were searched to and from the bathroom to check for stolen certificates. The trash cans were also checked on camera nightly to ensure no contraband or food was brought into work area. The supervisor and staff was monitored via internal security remotely and via 15 minute rounds to ensure he was on top of everyone. 40 people sat like that staring forward at a blank wall for many years while they converted over two trillion dollars of physical certificates to book entry. Much of the data only existed on the certificate itself, paying agent, transfer agent, call information and had to be retyped. I don’t know how many of you have ever been to the vaults but their was three, a muni bond/ bearer vault in Garden City, a Stock vault at 55 water and a corporate bond/mbs vault also at 55 water, each vault was the size of a football field with 40 foot ceilings. Really cool. At the peak of physical securities in the 1980s they had 1,000 armed guards mainly retired cops and corrections officers. Of course in the movie diehard they fail to neglect that once you get through the lobby, past the turnstiles, down the secure elevator past another guard, through the vault door, through the man trap and out the other side and disable the halon gas and oxygen sucking mechanism as well as the auto shut door, motion detactors etc. All guards had shoot to kill instuctions. Since bullets flying in a metal room is very dangerous the intstuctions was a single bullet shoot to kill head shot.
I miss the good old days when you could smoke at work, lock your workers in a vault and have armed staff.
That was an amazingly productive group that I greatly admired.
Clotpoll Says:
July 8th, 2008 at 4:04 pm
John (337)-
The solution is to put your employee under caged surveillance within her home.
Maybe you can work in some of the new shock bracelet technology to get her to really get off her fat, lazy a## and perform. :)
fg, don’t be dissing John.
You’ll inspire him to pen Chapter Six of
“As a Yute, I once…”
Then everybody will end up laughing all night and nobody will put any thought into the housing situtation.
Oh, I see I was a little late hitting “submit comment.”
Sorry, guys.
Do not taunt happy old John.
Real Deal:
NY’s price per square foot declines
http://ny.therealdeal.com/articles/ny-s-price-per-square-foot-declines
clott,
any word on what is/is not happening with VA loans?
Actually your commute time is “company time”. On my train ride in I clean out my blackberry emails and read the WSJ, on my train ride home I proof read some memos and do emails and such. At my old job I always had my laptop out on the train. Staff does not do that so it is not important as I get off peak emails they don’t.
The catch 22 at work is the married folk with houses and screaming kids at home mostly have small apts. or houses with no home office which makes it hard to work at home and the single people or people with no kids who can do it have no reason to do it other than their own personal pleasure.
Also there are legal ramifications. non exepemt get paid OT how do you track it. if you get injured at home how is that covered under disability. if worker runs out to mcdonalds to get coffee and runs over three people is work liable. when employee quits and confidential data is at their home or equipment how do you get it back or is it a violation of GLB or HIPPA? What if employee is attacked at home who is liable. Finally, if you have a mortgage for a residential property or are paying residential tax rates and you are earning a living at home you have committed mortgage fruad or tax fraud if you don’t declare the portion of the property as a businss. In other words a potential felony. Also unless employees offer up their seat in a hoteling situation and adhere to a clean desk policy the company is paying rent on an empty seat which is pointless. I like telecomuting in concept but in theory you have to limit it. If you do telecommuting officially you open yourself to a can of worms.
ChiFi’s in attach mode!
What’s he attaching himself to?
Prolly a bottle of cheap Australian wine, right about now.
fg: pay is based on 8 hours? I haven’t worked an 8 hour day in many years, and if anyone who works for me treats their job as a 9-5 excuse to work on their secretary spread then they are usually out the door within a few months either voluntarily or with a door hitting them in their fat backside.
The modern formula for pay these days is based upon face time and productivity, in my company if you don’t do both you are a gonner.
If you are some kind of paper pushing keywacker your days are numbered anyway since most of those back office jobs are headed overseas.
The correct way to sell part time telecommuting to any business is not to discuss fuel saving or hours worked but to discuss productivity. Companies do not care whether you are in to the office or not when you generate results and make them lots of money.
You go sean!!! shoot them all and let god sort them out.
I have management like John, really not to productive. Hours do not necessarily equate to units of work and one should never make that association, different people work differently some people are inherently more effective and thus require less time to complete tasks than others. As such the value equation should be what do they produce vs. what does this person cost. The telecommuting idea could work well for many employees and make them happier which always results in better productivity and a better product. John you need to look at the results not how your employee achieved them. In any event while I don’t telecommute, I would get more actual work finished on those days because I spend hours everyday kibbitzing with people in the office, when I am at home I have nothing to do but work or watch TV(Bad during the day) and honestly I’d prefer to work than run errands also when your boss calls your home it is better if you can answer the phone so you are more or less trapped in the house. So why don’t you let her telecommute 1 day a week as you yourself said the company gains nothing but loses nothing as well but by reducing the stress on that worker one day a week she may become more productive the other 4.
[355] John,
Amusing story. I worked in the vault floor at STT in Boston in the 80’s. By then, certs were going the way of the dodo (and kept within a second, more secure vault), so we rarely saw them however I still have a folder full of old worthless gold mine and RR certs, most over 100 years old, and some Imperial Russian bonds (with coupons after 1918 still attached) that somehow didn’t find their way to the shredder.
One thing I remember fondly about that job were the drinking. Nearly every night, we went out and got blasted. Combination of old, burned-out clerks and recent grads, all getting baked together.
Sean face time is the biggest load of crap I have ever heard, it is really overrated. Management should as a single question of me and my team, do I get results. Face time to me means non important meetings, I work 9-10 hour days, do I ask that my team members do that? No, I only care that you complete tasks as scheduled, if you can’t do it in an 8 hour day fine stay 9 or 10 or work on it at home, I don’t care as long as it is done and done well. If you show a lot of skill and you are putting in a lot of effort and you deliver good work than you are on the promotion track otherwise you are working your way into mediocrity. My gf works at a large financial firm and their nonsense of face time and everyone has to be here at 8am is nuts, I have seen the product they produce and have seen many good people burn out quickly, it makes no sense. The only thing that matters is if you can deliver where others have been unable to.
217 mike
“Where does Frank’s IP address resolve to? This should answer the realtor question once and for all.”
I don’t think this is a question that can fairly be asked of grim.
When did Fair show up and who invited her?
;0
From msnbc:
As the housing market and broader economy continue to sag, Senate lawmakers appeared on track to approve — possibly by week’s end —a rescue plan designed to save hundreds of thousands of homeowners from foreclosure.
238 hobo
“I am in the market to buy a new condo, and I am not seeing prices go down in the more desirable buildings.”
Asking prices or selling prices?
262 RayC
“njpatient
True, still grossly overpriced, though by my non-scientific observation, ~10% lower asking prices than in early 2007.
———
I agree with your observation. But I think I am at least 10%-15% away from anything I have seen.”
Seems like we are paddling the same boat, Ray. I’ll be watching the other shoe drop over the next year.
When I didn’t manage people, I telecommuted all the time, and I did get more work done when I worked from home.
I now work 8-5. I’m the first one out the door at night, and don’t really care. I literally do the job of 2 or 3 people (I tend to balance 8-9 projects while coworkers at my same level don’t even do half that; my numbers back me up).
Face time is crap. If you are good, people don’t need to see you pretend to work at 7PM because you have blown 3 hours of the day surfing the web. At my first job, I was the first in and last out. When they laid us off, everyone got let go, regardless of how much face time they had invested. Life is too short wasting time in the workplace just for show.
That said, I’m going outside to the park to play with my kids. Those of you still in the office at this point, not working on a particular project with a tight deadline, should really shut your computers down and head home. Again, life is just too short.
269 bairen
“It’s too funny isn’t it. The people who claim that can’t see bubbles until after they have collapsed are the same ones who want more powers to regulate.”
It’s so funny it brings tears to my eyes.
#197
In 2004, almost half (47%) of suburban municipalities were not able to estimate
the size of gangs in their jurisdictions. Of those gangs whose membership they
could estimate, smaller gangs (fewer than 26 members) made up the largest
number of gangs active in their jurisdictions.
• Larger gangs –those with more than 76 members reported— were reported only
in urban suburban and urban center municipalities in both the 2001 and 2004
surveys. In the 2004 survey, urban suburbs and urban center municipalities
were better able to estimate the size of gangs in their jurisdictions than they had
been in 2001.
• In both the 2001 and 2004 surveys, urban suburban and urban center
municipalities account for over 90% of statewide gang membership estimates.
#197
In 2004, almost half (47%) of suburban municipalities were not able to estimate
the size of gangs in their jurisdictions. Of those gangs whose membership they
could estimate, smaller gangs (fewer than 26 members) made up the largest
number of gangs active in their jurisdictions.
• Larger gangs –those with more than 76 members reported— were reported only
in urban suburban and urban center municipalities in both the 2001 and 2004
surveys. In the 2004 survey, urban suburbs and urban center municipalities
were better able to estimate the size of gangs in their jurisdictions than they had
been in 2001.
• In both the 2001 and 2004 surveys, urban suburban and urban center
municipalities account for over 90% of statewide gang membership estimates.
[201] Patient,
I also think it is overpriced, but the market determines price and while I have seen prices come down on some houses, things that are more reasonably priced are getting snapped up, even if not in the best parts of town. Grandview came on and got 4 offers immediately, even though the ‘hood was more Garwood than Brigadoon, because it was priced well under comps for the town as a whole.
Mrs. Nom and I are thus on the horns of a dilemma: Offer asking price on the things we think are good values, or hold off until the rush of Hobokenites with kids has died down and wait for new listings? I have no good answer here.
281 frank
“it is common knowledge that RE prices have barely declined in NJ.”
You misspelled “bearly.”
#282 Rich: BAck to 03 prices in Blue Ribbon River Ede? OMG!!!.
Hey Frank 2004 prices in a blue ribbon train town, 2003 is coming for you frank.
295 chi
“furts: mix?”
You just went right over his head
298 chi
“About 30 percent of all first-quarter closings were for apartments in new developments that went into contract before turmoil hit the credit market”
Wow.
We’re going to get an ugly quarter soon, with a precipitous drop, given that stat.
Pat Says:
July 8th, 2008 at 4:58 pm
Prolly a bottle of cheap Australian wine, right about now.
Thanks to the in-laws, I am going to attach to this in about an hour….
http://www.flickr.com/photos/25673821@N00/96899726/
337 john
“Tom Souzi (who is an up and coming, may be governor one day)said that sounds great, all he needs is for the workers to sign a form saying they will not operate a motor vehicle or use public transportation on the day fifth day. He said if people drive to work one less day and then use that day off to go to beach, play golf run errands how the heck does that save fuel? Good Point. ”
No, it’s a stupid point, unless he’s in the habit of hiring people who don’t actually work in the first place, in which case he’s got worse problems already.
364 sean
“The correct way to sell part time telecommuting to any business is not to discuss fuel saving or hours worked but to discuss productivity”
Why not discuss reduced overhead?
#19 gryffindor
I was in DC yesterday and went around some of the developments which had more units on sale than were occupied. Many of them short sales since the asking prices were less that they sold for.
About a year and half ago, I convinced my cousin who had put a deposit on a Khov Town Home to take his money back and buy a sports car which he did much to the dislike of his folks.
Now he can buy the same unit for about 100K less and he has the sports car. He was really happy with the decision. He said that there was so many distressed properties in the DC metro area he was going to start low balling some of them.
379 Nom
It really depends on personal preference at this point. I do very much want to own a home, for various of my own reasons, and the same is true of Mrs. Patient. There will come a time when I will buy, and I suspect it will come significantly before the time when I believe the true “bottom” will have arrived.
It’s not an investment – it’s the right deal at the right time for me, and I’ve already got the right time in my sights.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aa2D1eC6Ed6s
“Let’s hope we are all wealthy and retired by the time this house of cards falters,” said the e-mail, which was sent Dec. 15, 2006, to another analyst at the same firm.
#375
“Those of you still in the office at this point, not working on a particular project with a tight deadline, should really shut your computers down and head home. Again, life is just too short.”
What industry do you work in again? You do understand that there are some jobs where this sort of thing is not a matter of choice.
217 Mike
“Anyone have any idea what RE taxes would be like in Hoboken on a $700K apartment? Just wondering.”
There’s a huge spread depending on when it was constructed. Hudson county is not big on re-evaluations in general. The $700k condo I am familiar with (nice luxury building, but early build) pays ~$7,400 in annual taxes. Assessed value is $225k compared to a market value of low $700s (current, based on in building comps).
In downtown Jersey City a $630k condo (again same spread based on year of construction) runs about $6k in taxes. If/when a re-eval hits the folks (less those with 20/25 year tax abatements) in downtown JC will bleed. Unlike Hoboken JC has select few gentrified areas that will take a huge hit at re-eval time. I’d love to see how that plays out.
I once considered those tax bills low – HA!! In either city, with 3 kids I’d be paying a min of $30k/year in tuition for elementary school on top of my property taxes. The commute is a dream, but where there tax money goes is beyond me. And people in the burbs complain..
Frank, Hoboken sale prices have declined, albeit not as dramatically as other parts of NJ. I think they still have more of a decline to go as rental prices have REALLY dropped, so anyone with basic math skills knows they are better off renting, at least until the RE market comes in line with the rental market.
lostinny (362),
It’s one of my favorite misspellings from the board.
Rich
How did that come to be? Was it bi that misspelled it?
Pat Says:
July 8th, 2008 at 4:58 pm
Prolly a bottle of cheap Australian wine, right about now.
Ahem. I’m here now and plan on posting over the next few days, so please absent yourself.
215: ChiFi…
That was a nice post. A good lesson many of us haven’t learned, exactly…(like me) and a good reminder for those who have.
It’s hard to go backwards unless you see a see “a bigger picture”, and believe me, I do try… but then I think…”Holy crap!Time’s flying and I have like three whole minutes in the span of eternal time to get there! No time to go backwards!”…
Why, just last week I was 12 years old. Next week is Christmas…
Arghhhhhhhhhhhhhhhh!!!
172: john, may i ask what criteria you use to deem astoria a hellhole? (i think it’s one of the best neighborhoods i’ve lived in.)
Oh boy!
Frank, Hoboken sale prices have declined, albeit not as dramatically as other parts of NJ. I think they still have more of a decline to go as rental prices have REALLY dropped, so anyone with basic math skills knows they are better off renting, at least until the RE market comes in line with the rental market.
I’ve noticed the drop in rental rates as well. And as more owners end up abandoning their hopes of selling, and renting their condos out, this will just add to the supply of rental units, driving rents down even further.
Basic supply & demand.
Remember:
1) Don’t Panic!
2) If you do Panic, make sure you’re the first one to Panic.
# 232 “A 900 buck investment that pays 120 bucks a year interest can fund three rub and a tugs a year”
Do I even want to find out what a “rub and tug” is, or should I not ask?
ChiFi (351)-
Thanks, but I disclaimer everything I say & I take the risks with eyes wide open. Being heavily short is not why I got into investing, nor can I say it is especially fun. I do not find it fun at all. It feels to me like betting against my favorite team. The “wins” always feel sorta empty.
However, I’d rather be short a ton of stuff and slagging out a single-digit return than being long a sinking ship and waking up every day wondering if this will be the one when all the rats abandon it.
Because one day very soon, the rats will be taking a walk.
All disclaimers.
# 286 “One play I’m considering is shorting oil, but not before I see $155-$175. Too much risk to the upside with Bush in office and Iran playing games with him. ”
I cannot shake the feeling that sometime after the election in November, especially if Obama wins, George III will launch a protracted military attack on Iran.
“A right to property is founded in our natural wants, in the means with which we are endowed to satisfy these wants, and the right to what we acquire by those means without violating the similar rights of other sensible beings.” –Thomas Jefferson to Pierre Samuel Dupont de Nemours, 1816.
vodka (360)-
They are much easier than they used to be. The extra inspection is no longer needed and a good lender can actually close a VA loan in about 5 days. A buyer can also avoid MIPs with a VA loan, and that’s hard to do in the conventional market right now. VA also increased their maximum loan amount in our area. VA loans can also offer a better rate than conventional financing. Navy Federal also has a loan program call Veteran’s Advantage (?) that is similar to a VA loan but a little better in terms and conditions.
VA loans also allow for 100% financing without MIP. There is, however, a one-time funding fee, which is waived for injured vets.
Best of all, VA loans are assumable, which means that when the call or transfer comes, a soldier can dump a house quick in a problematic market.
Pat (370)-
“When did Fair show up and who invited her?”
Dat’s wat I’m talkin’ ’bout! Dammit, Grim owes us the favor of opening up the biggest DOS attack on Frank in the history of the internets!
sl (378)-
My preppy, lacrosse-playing daughter can throw all the MS-13 signs (under threat of death- at my hands- never outside the doors of my house).
She learned them at N. Hunterdon HS.
I know this guy committed a crime and there should be some consequences, but isn’t 10 years a little too much?
“Library thief gets 10 years, big bill”
http://www.denverpost.com/breakingnews/ci_9819779
SAS
sas (405)-
Good thing Colorado doesn’t practice Sharia law.
I like this one here:
“Let’s kill the environment to save the doughnuts!”
man, that about sums everything up…doesn’t it.
SAS
Here’s another shot in the a$$ for the Menlo Park Mall
“Fast-growing retailer Steve & Barry’s is expected to file for Chapter 11 bankruptcy protection as early as Wednesday … A filing would be devastating to mall owners across the country, who ponied up hundreds of millions of dollars to attract Steve and Barry’s into huge, empty spaces often as large as 100,000 square feet. Potentially all of those 275 stores could close”
WSJ via CR
http://calculatedrisk.blogspot.com/2008/07/more-bad-news-for-malls-steve-barrys-bk.html
I am in the market to buy a new condo, and I am not seeing prices go down in the more desirable buildings.
By definition, the more desirable buildings have more demand. Hence it takes longer for prices to decline.
Wastin’ time
http://www.youtube.com/watch?v=wzrXc68gNjQ
I can’t do what 10 people tell me to do
One point not to lose sight of on the oil front is what happened to oil prices in the leadup to the 2006 federal election.
May happen again this October.
that’s it. I quit.
I found your site on technorati and read a few of your other posts. Keep up the good work. I just added your RSS feed to my Google News Reader. Looking forward to reading more from you down the road!