Curb the optimism, this is not the bottom

From Reuters:

Mortgage delinquencies soar in the U.S.

More U.S. consumers are falling behind on their mortgages, an indication that the housing market has yet to hit bottom, a top credit bureau executive told Reuters.

Dann Adams, president of U.S. Information Systems for Equifax Inc, reported that 7 percent of homeowners with mortgages were at least 30 days late on their loans in February, an increase of more than 50 percent from a year earlier.

He also said 39.8 percent of subprime borrowers were at least 30 days behind on their home mortgage loans, up 23.7 percent from last year.

“I’m trying to find optimism in these numbers, but I’m pretty hard pressed to do that,” Adams said, despite a recent burst of relatively positive news that has fueled hope that the U.S. housing market has turned a corner.

From HousingWire:

Mortgage Delinquencies Pile Up: Report

Same story, different month: delinquent mortgages continued to accumulate in February, which according to a top credit bureau executive, is an indication that the housing market has not yet seen its bottom.

“I’m trying to find optimism in these numbers, but I’m pretty hard pressed to do that,” said Dan Adams, president of U.S. Information Systems for Equifax Inc.

But Adams told Reuters the continued increase in mortgage delinquencies revealed in his data foreshadows more foreclosures, short sales and home price declines as homeowners default and banks then repossess the homes to sell them at steep discounts.

From CNBC:

Foreclosures Worsen, Blocking Recovery

I said it yesterday, and I’ll say it every day: Until the number of foreclosures in this country starts to go down instead of up, we will not see a full recovery in the housing market; I don’t care how upbeat you are about buyer traffic this spring.

A new report out today shows foreclosures continue to rise.

Equifax, a well-respected credit bureau, found that 7% of homeowners with mortgages that were at least 30 days late on their payments in February, that’s up 50% from a year ago. And close to 40% of subprime borrowers are late, up from 23.7% a year ago.

Not good. With job numbers getting worse, more and more borrowers are going to end up missing payments, and no matter how much the banks and the Obama administration would like to help these folks, you can’t modify a loan down to a zero monthly payment.

This entry was posted in Economics, Housing Bubble, National Real Estate. Bookmark the permalink.

101 Responses to Curb the optimism, this is not the bottom

  1. Frank says:

    Where’s the recession???

    April 7, 2009

    “As of today, lenders are looking to fill 39,174 mortgage positions, according to data reported by online job search engine Indeed. Recruiters accounted for 11,092 of the job postings, while employers accounted for the rest.
    Mortgage job listings topped out in July 2005 then trended down until late last year. A spike in postings hit in January.”

    “Bank of America had 1,173 jobs posted, while JPMorgan Chase had 924 and National City had 717.”

    “The busiest city was New York, where 697 mortgage jobs were available. Dallas was next, with 646 available positions, then Houston, where 536 mortgage openings were. Minneapolis was No. 4, with 525 listings, then Jacksonville, Fla., where 524 open jobs were being advertised.”

  2. make money says:

    Peters newsletter,

    All kinds of bonds (corporate, government and municipal, etc.) that are not in default frequently trade at discounts. In fact, the reason that agencies such as Moody’s and Standard and Poor’s rate bonds is to assess the probability of default. The higher that probability, the lower the value placed on the bonds, regardless of their current cash flow.

    For example, GM bonds that mature 10 years from now currently trade for only 8 to 10 cents on the dollar, despite the fact that GM is current on all interest payments. The 90% discount reflects investor awareness that GM will likely default long before the bonds mature. By the new logic, financial institutions with GM bonds on their balance sheets should be able to ignore the market and value these bonds at par.

    Some argue that the comparison is invalid because GM’s bonds are liquid while mortgage-backed securities are not. However, if sellers of GM bonds were holding out for 70 or 80 cents on the dollar, those bonds would be illiquid too. The reason GM bonds are trading is that sellers are realistic.

    The same should apply to bonds backed by mortgages. To assume that a 30-year, $500,000 mortgage on a house that has declined in value to $300,000 has a high probability of remaining current to maturity is ridiculous. The borrower could lose his job, his ARM might reset higher, or he may simply tire of paying an expensive mortgage for a house that is unlikely to be sold at a profit. Any bond investor with half a brain will factor in these probabilities and look for deep discounts. The only way to accurately assess a real present value is to let the market discover the price.

    Despite the pleas from bankers and politicians, mortgages are not plagued by a lack of liquidity but a lack of value. If sellers would be more negotiable, there would be plenty of liquidity. Who knows, at the right price I might even buy a few. The problem is that putting a market price on these assets would render most financial institutions insolvent, which is precisely why they do not want to let that happen.

    Simply pretending that all these mortgages will be repaid does not solve the underlying problems. It may keep some banks alive longer, but when they ultimately do fail, the losses will be that much greater. In the meantime, solvent institutions are deprived of capital as more funds are funneled into insolvent “too big to fail” institutions – hiding their toxic assets behind rosy assumptions and phony marks.

    Going from the sublime to the completely ridiculous, in a speech at the just-concluded G20 summit in London, President Obama urged Americans not to let their fears crimp their spending. It would be unwise, he argued, for Americans to let the fear of job loss, lack of savings, unpaid bills, credit card debt or student loans deter them from making major purchases. According to the president, “we must spend now as an investment for the future.” So in this land of imagination (where subprime mortgages are valued at par), instead of saving for the future, we must spend for the future.

    I guess Ben Franklin had it wrong too – apparently a penny spent is a penny earned.

  3. gary says:

    Ya know, it’s tough when you have an IQ of around 87 like myself. Perhaps you can explain to me why this house is listed for $749,000 dollars. Say that price out loud: Seven Hundred Forty Nine Thousand Dollars.

  4. grim says:


    High asking is due to the very rare combo of both brick and stucco. Attracts buyers even better than granite/stainless.

  5. SS says:

    Re #3:
    What…you missed it…not only does it have a garage door opener but it has sprinklers too. Quite a rare combo there.

  6. grim says:

    From Bloomberg:

    Manhattan Office Rents Fall Most in Quarter Century

    Manhattan office rents fell the most in at least 25 years in the first quarter as financial companies slashed jobs and relinquished space in the U.S. recession.

    Rents dropped 6 percent from the fourth quarter to $65.01 a square foot, commercial property broker Cushman & Wakefield Inc. said in a report today. The decline is the most in records dating back to 1984, Cushman said, and shows how much the fallout from the September bankruptcy of Lehman Brothers Holdings Inc. hurt the New York property market.

    “It’s gone beyond the financial firms,” Joseph Harbert, Cushman & Wakefield’s chief operating officer for the New York region, said in a telephone interview. “It’s broad across a lot of industries. Everybody has the same way of thinking, which is low confidence in job growth, consolidation, cutting expenses, not hiring unless you really have to.”

  7. Shore Guy says:

    ““This board doesn’t know how truly good-looking I am… go ahead, tell them! ;)”

    Well, let’s just say you are almost as beautiful as yours truly

    But only one of you looks good in a chrreleader’s outfit.

  8. grim says:

    Oh sweet jesus, it has granite and stainless too.

    Gary, I’d suggest putting in an offer immediately, hell, go 5% over asking too.

    Don’t let this one get away.

  9. Shore Guy says:

    “Wouldn’t these new banks be insolvent from the start if they had only $1 trillion in assets backing 4+ trillion in FDIC insured deposits? A bank run would make the whole thing fall apart.”

    No. Currently, the banks have some assets and LOTS of actual and potential debt. What I suggest is to create 4 new banks, and capitalize them at $250B each. There they sit with LOTS of assets and no liabilities. Allow people to move deposits over, now they have even more cash and still no liabilities. Next we allow “good loans” and other assets to move over; here we add some liabilities but acceptable levels of risk, especially given the lack of toxic liabilities.

    Now we let the toxic loans bring down the mismanaged banks. Let the investors who never demanded competence or prudence from the banks suffer the losses. No FDIC money is at risk. Even if it were, we would be bailing-out innocents and not folks who caused the mess or allowed it to continue.

  10. Shore Guy says:

    “This board doesn’t know how truly good-looking I am”

    The other thing that often goes unnoticed is Gary’s modesty.

  11. Shore Guy says:

    That park Ridge home also has the benefit of: “Electric heat.” I guess that way one’s heating bill can be larger than one’s mortgage payment.

  12. gary says:

    Let’s sum it all up: I’m a really good-looking guy who is going to buy a house in Park Ridge today for 5% over asking. ;)

  13. grim says:


    The insane part about that listing isn’t the asking price.

    The listing is a SHORT SALE.

    Mortgage balance above $880k on *THAT*?

  14. kanan says:

    #3 Gary wrote:

    “Ya know, it’s tough when you have an IQ of around 87 like myself. Perhaps you can explain to me why this house is listed for $749,000 dollars.”

    It’s listed at $749,000 for the same reason destitute couple Bruce and Harriet Nyborg wrote Shelley ‘the machine’ Levene a check for $85,000

  15. From CalculatedRisk Stress test results delayed. And it looks like they want to try a summary results report with no specific institutions identified…

    It must may been an epic fail.

  16. #16 – It must have been an epic fail

  17. 2 Cents says:

    “a summary results report with no specific institutions identified”

    Nice! May have to check Webster’s if the definition of “transparency” has changed.

  18. Matthew says:

    Sean – it’s fun trying to picture the realtor sitting around struggling to think of things to say that might warrant an exclamation point (or two!! or three!!!) on that listing in Alpine …

  19. Clotpoll says:

    tosh (16)-

    They need more time to falsify the results.

  20. make money says:

    They need more time to falsify the results.


    No point to spend time to try to make those numbers look credible. No one is gonna believe them anyway.

    but to make this stress test seem credible they will have to sacrifice an institution or two.

    Who do we know has publicly pissed Timmy G and Fedco?

  21. make money says:


    Are you adding to your shiny at these levels? Are you still bulish shiny?


  22. chicagofinance says:

    albani: congrats on spreading the seed….um…HK?

  23. chicagofinance says:

    make money says:
    April 7, 2009 at 2:55 pm
    BC, Are you adding to your shiny at these levels? Are you still bulish shiny? MM

    albani: you got to be holding your breath here….you would think up, but any more down means WAY down….

  24. chicagofinance says:

    bost: ya’ think Meredith Whitney does TA? T&A, maybe….

  25. #20 – Clot – They need more time to falsify the results.

    You know, I honestly get the feeling that they just don’t have enough imagination for that. Instead they’re all in the same meeting, around a table, looking at the results going, “umm…. hmmm. Maybe… uh” and hoping someone else will miracle up a solution to whole thing.

  26. 2 Cents says:

    “and hoping someone else will miracle up a solution to whole thing.”

    Tosh –

    Maybe the ShamWow guy can help.

  27. BC Bob says:

    Make [22],

    Remember, it’s trading in a range, 690-1050. I am hedging at the top of the range and adding on any selloffs, like a kid in the candy store. I don’t care how it trades, day to day. I just make adjustments. Each day that goes by, I am more and more bullish. The enablers/pushers have this set up better than the X-Mas window display at Saks. At this time, I have been with it for 6 years. I anticipate another 5-6 years. Wake me up at 2-1.

    By the way, Paulson, not Hank, plunked down $1.3B on Anglo. What does he know?

  28. Sean says:

    re: #28 BC Bob – He prob was hedging against the Fed buying Treasuries.

  29. chicagofinance says:

    Bost: To be clear, what some bozos call fundamental analysis and actual fundamental analysis are two different things.

  30. 2 Cents says:

    Gents, Remember a while back we were wondering what happened in 1985 that the stock market suddenly zoomed to the sky?

    Well, looks like the Dollar did not like the action so much. Down 51% in 4 years from 85-89.

  31. comrade nom deplume says:

    [31] tosh,

    “The localities most at risk of having their Moody’s bond ratings downgraded will be those with: industries such as real estate, auto manufacturing or financial services; reliance on falling revenue sources such as sales and real-estate transfer taxes; volatile variable-rate debt; and a high proportion of fixed or legally mandated costs, according to today’s report.”

    Lets see: declining RE? Check. Declining financial sector jobs? Check. Declining revenue sources from taxes? Check. High proporton of legally mandated or fixed costs? Check and Check.

    We are sooooo fcuked.

  32. Outofstater says:

    Make – Congrats!! 8 pounds – only three more to go til he sleeps thru the night!(at least that’s when mine starting letting us sleep a little).

  33. Sastry says:

    Shore, re: “Mrs. Shore and I, for instance pay about 60% of our income in income tax.”

    How do the taxes go to 60%. You literally have to do 36 + 8 + 15 on your entire income?, but the 15% stops after the FICA limit. No retirement plan, no nothing…

    Bad tax accountant? Double counting taxes? I think including property taxes in the mix is probably unfair (since the numbers I used do not include property taxes)…


  34. HEHEHE says:

    Didn’t O’bama watch 24? This guys a terrorist:

  35. Sastry says:

    Make Money… Congratulations. Best wishes for the mom and baby.

  36. make money says:

    I anticipate another 5-6 years. Wake me up at 2-1.


    Are you saying that 2:1 is gonna take six years.

  37. make money says:

    Thank everyone for your congrats and best wiches.

    This year I’m gonna make it a point to come to a get together.

  38. Shore Guy says:


    I am not going into the details beyond this: we are bots self-employed, we have income from and pay taxes to — depending on the year — between 15 and 22 states, we have income from a number of countries in Europe and Asia as well, we do not have a mortgage, and we do not cheat on taxes.

    I trust that were you to suddenly find yourself in our income bracket you would be asking yourself, “Where is all my money going?” Those who have been around awhile know I grew up poor. Back then, I could never figure out why some people were complaining about the “complexity” of the tax code; all yoi need to do is add W-2 income, some 1099s, do a fewcalculations and get a refund check, right?

    After years of slogging it out in the trenches we have done okay and let me tell you the tax code is a major wreck. If you read the forms you fill out, they probably say something like, Oestimated time to assemble records and complete is six hours.” We have one, ONE, that estimates 47 hours. That is ONE of the forms. The accountant LOVES us.

    For those of us with businesses, taxes are not a once or twice a year thing, they are a monthly thing. As such, we, perhaps, see the absurdity of the current tax structure better than those who are employed and who are not in the AMT, yet — inflation will get you there soon enough; and when it does, we will have a defacto flat tax.

    I don’t want you to pay a greater percentage than I do. But I ask you this, let’s say you and I are gardeners and work for the same company. And let’s say I did other work as well so I earned more than you, overall. When you and I go weed someone’s garden together, why should I pay more tax on each extra dollar I earn than you do on yours? Is it like Animal Farm, where all animals are equal except some are more equal than others?

  39. BC Bob says:

    Make [38],

    An estimate, based on cycles. I certainly won’t be dissapointed if it occurs sooner.

  40. Outofstater says:

    #3 Because it’s ugly?

  41. Sean says:

    Perhaps I should move to ChicagoFinance’s neck of the woods?

    This little fixer upper has lots of potential.

  42. Clotpoll says:

    make (21)-

    I think any bank other than JPM and GS are targets. C stands out as the sickest wildebeest in the pack.

    “Who do we know has publicly pissed Timmy G and Fedco?”

  43. BC Bob says:


    Congrats! Maybe some day? Yeah, dreaming.

  44. Outofstater says:

    #13 Sorry, Gary, Sean wins. HIS house is more expensive, uglier, smaller and YELLOW too!!!!

  45. BC Bob says:


    The land is worth more than that in CN?

  46. Essex says:

    40. I swear I thought you were retired. We pay a guy about $600 each year to do our taxes….Yep….$200k+ bracket sucks. Oh well, beats bein poor.

  47. BC Bob says:

    “Is that an outhouse in back?”

    Shore [48],

    Actually, looks like the fed’s balance sheet is stored there.

  48. Essex says:

    Any odds on the ‘next big bailout’ the tax payer will fund?

  49. Essex says:

    Oh crap…I forgot….Five O’Clock and the desks/Cubes clear around here.

  50. David says:

    #9 Shore Guy,

    “Allow people to move deposits over, now they have even more cash and still no liabilities. Next we allow “good loans” and other assets to move over; here we add some liabilities but acceptable levels of risk, especially given the lack of toxic liabilities.”

    You’re confused about assets and liabilities. Deposits are liabilities on a bank’s balance sheet, and loans are assets.

    For the most part it’s not investors that are getting bailed out; it’s creditors. And I agree with you that it should stop.

  51. BC Bob says:

    Essex [52],

    Maybe you should find a happy hour?

  52. HEHEHE says:

    Nationwide Layoff Watch: Baker & McKenzie Ends The Brief Lull in Layoffs

    I hope you enjoyed the brief lull in major layoff news. It’s been five days since Mayer Brown axed 135 people. Alas, Baker & McKenzie has broken the layoff silence. Above the Law has been able to confirm that the firm laid off 124 people today.

  53. Essex says:

    54…heh heh. My happy hour is always spent in the same place this time of day…with my five year-old daughter. Beverages optional.

  54. BC Bob says:

    SX [56],

    That sounds like the quintessential margarita.

  55. chicagofinance says:

    Sean says:
    April 7, 2009 at 4:57 pm
    Perhaps I should move to ChicagoFinance’s neck of the woods? This little fixer upper has lots of potential.

    Sean: you can’t just move there…you have to pass the douche bag test in order to qualify….

  56. BC Bob says:

    Don’t know if this was posted?

    “The U.S. economy is in for a “lasting slowdown” and could face a Japan-style period of relatively low growth coupled with high inflation, billionaire investor George Soros said on Monday.”

    “Soros, speaking to Reuters Financial Television, also warned that rescuing U.S. banks could turn them into “zombies” that draw the lifeblood of the economy, prolonging the economic slowdown.”

    “What we have created now is a situation where the banks who will be able to earn their way out of a hole, but by doing that, they are going to weigh on the economy,” he said. “Instead of stimulating the economy, they will draw the lifeblood, so to speak, of profits away from the real economy in order to keep themselves alive. This is the zombie bank situation.”

  57. grim says:

    Is debt service the new bubble? Savings?

    From Bloomberg:

    U.S. Consumer Credit Decreased by $7.48 Billion

    The pace of borrowing by U.S. consumers fell in February as fewer Americans sought credit to make purchases amid what may become the worst recession in seven decades.

    Consumer credit fell by $7.48 billion, or 3.5 percent at an annual rate, to $2.56 trillion, the Federal Reserve said today in Washington. Credit increased by $8.14 billion in January, more than previously estimated. The Fed’s report doesn’t cover borrowing secured by real estate.

    Demand for credit in the U.S. probably shrank further in March, the fourth straight month job losses exceeded 650,000, as unemployment climbed and banks remained reluctant to extend affordable loans. The recession that began in December 2007 has cost 5.1 million Americans their jobs, crippling the consumer spending that accounts for almost 70 percent of economic growth.

    “Consumers know they have to cut back on debt,” said Christopher Low, chief economist at FTN Financial in New York. “But it’s hard to change old habits, so we go through these periodic binges of credit, as we did in January, and then we go through a couple of months of paying down our balances.”

  58. grim says:

    #60 – I blame w8ting for paying down her/his card balances.

  59. BC Bob says:

    “Is debt service the new bubble? Savings?”


    It’s the only alternative. The old model is broken, kaput. That’s why this won’t be daddy’s recession. It’s grandpappy’s. This is not a slowdown in a business/inventory cycle. A total restructuring is required. Can Pavlov’s dog be retrained?

    One other item, there is no credit freeze. It’s strictly solvency.

  60. Stu says:


  61. poor guy says:


    sorry-I had no intention to start a class warfare-just the idea that less tax to rich translates to more jobs for us (not more money for them) made me laugh.

    However do not underestimate class warfare. It is an amazing force that translates to fundamental changes. Some say this is the only force but I won’t agree.

  62. grim says:

    Good news for housing? Nope.

    From Reuters:

    US apartment market worsens with economy–Reis

    The vacancy rate for U.S. apartments hit a three-year high in the first quarter and asking rents dropped the most in at least 10 years as the number of excess apartments on the market ballooned, according to real estate research firm Reis Inc.

    And the figures are forecast to get even worse as more apartment buildings are expected to open this year, increasing supply, and as the U.S. employment picture gets uglier, Reis said.

    Job creation is the No. 1 driver of demand for apartments.

    “Given that things are weakening right now, any new buildings that come on will add additional pressure to landlords,” Victor Calanog, Reis director of research, said.

    The national apartment vacancy rate rose to 7.2 percent in the first quarter, up 0.60 percentage points from the prior quarter and 1.1 percentage points from a year earlier, according to the report, released on Tuesday.

    Since reaching a cyclical low of 5.5 percent in the third quarter of 2008, the U.S. apartment vacancy rate has surged 1.7 percentage points, Reis said.

    It was the highest vacancy rate since the first quarter of 2002. That was right before the last downturn bottomed out, but Reis expects the picture to get a lot darker as “we are arguably only at the beginning of the current downturn.”

  63. grim says:

    From the Record:

    Hundreds scammed by tank removal company

    Hundreds of people in North Jersey were scammed by a storage tank removal company that faked tests on underground oil tanks to generate business, state Attorney General Anne Milgram announced Tuesday.

    The clients, typically homeowners, were cheated out of tens of thousands of dollars when the company falsified test results – in some cases adding oil to soil samples — to make it look like tanks were leaking.

    Albert Taylor, who ran the Lincoln Park company, was indicted Monday on two counts of racketeering and conspiracy to commit racketeering, and two counts of theft by deception. Taylor, 48, who now lives in Rocky Mount, Va., will be arraigned at a later date.

    “We charge that this defendant systematically defrauded clients by falsifying test results to generate business,” Milgram said in a statement. “This defendant preyed on the fears of customers who were worried about the potential liability posed by a leaking underground tank.”

    The customers were in Bergen, Passaic and Morris counties as well as Central Jersey and even into New York State and Maryland, officials said.

    Taylor’s tank testing company did business under a variety of names, including Tank Automation, Tank Tek, IDC Tank, All Tank Services, Tank Environmental Service and Computek Services LLC, according to the Attorney General’s office. The company no longer operates in New Jersey, officials said.

  64. grim says:


    Almost every client was told the test results indicated their tanks were leaking.

    In addition, Taylor charged numerous clients from $350 to $850 to take soil samples around tanks, and then had employees add oil to the samples, according to the indictment.

    Once the company’s employees told clients their oil tanks were leaking, they would recommend Tank Management as a reputable company to remove the tanks — without mentioning that Taylor owned the company, according to the indictment.

  65. poor guy says:

    bc bob

    I would think so too. what puzzles me is why government persists on the old ways. they don’t even consider the alternative.

  66. tbiggs says:

    But Suzanne researched this!

  67. kettle1 says:

    The NYT article from the other day titled “Housing affordability improves, April 5 09″annoyed me.

    I would love to see how they actually calculated the index and with what data. I pulled the methodology off the NAR site and used NAR and US census data and got VERY different results. Yes, technically affordability is improving, but it is still so far out of whack, that they article is almost all fluff BS.

    There is also the little trick of basing calculations on Net vs Gross income and PI vs PITI


  68. Sastry says:

    Shore Guy says:

    “When you and I go weed someone’s garden together, why should I pay more tax on each extra dollar I earn than you do on yours?”

    That is a very complex question. Why should someone with more kids pay more in taxes that someone with no kids? Why should X [get|have|pay] [more|less] than Y? Why should a janitor that works very hard to clean up messes make 0.001% of a trader that plays with others’ money and makes messes?

    BTW, in your situation, may be different states/countries are eating up your share of income. I understand that you should probably not give more details, but your situation is clearly an exception than a norm. Normally, people would end up substantially less for the same income.


  69. Sastry says:

    kettle1 says:
    April 7, 2009 at 6:27 pm

    The NYT article from the other day titled “Housing affordability improves, April 5 09” annoyed me.


    Welcome to the headlines, “Sun soars on takeover news” [recent split adjusted $1.2 to $2.2], or “Lehman doubles on rumor!” [from $0.01 to $0.02] :)

    Affordability improves, from “absolutely no way” to “huh, mmm, no way” :)


  70. Sastry says:

    grim #66

    Imagine the same guys doing soil tests on “new developments” to be build on landfill sites. A little bit money in their hands and they will send a “clean” certificate.

    Imagine the government loosening regulations as a means for job creation…

    Imagine next, a law that exempts the landfill owners and the certifying company from any liability in the future because they will bring new jobs soon…

    Welcome to NJ!

  71. poor guy says:


    helpful graphs thanks

  72. HEHEHE says:

    I was pretty impressed with the sweeping change in candor in most of the business headlines going forward from about a month ago. It makes you wonder what goes on behind the scenes in the major media outlets in this country. You look at the “data” they’ve been putting a positive spin on lately and it really boggles the mind. Ritholtz had a piece on it a couple weeks ago. I mean if it were true that there was a turn-around going on I’d be happy not having to worry about losing a job but anybody with half a brain knows these headlines are bs.

  73. BC Bob says:

    JB [66],

    Know them well. I got a quote for a minimum of 20K. They said it could go up to 50K, depending on the depth of the seepage. I immediately called in another firm. No leak, $895 to clean and bury with stone/sand.

  74. yikes says:

    bc, when you said ‘6 years’ … was that in ref to the entire mess?

    are you saying the unemployment situation is going to last well beyond 2010?

    i dont expect housing to rebound for a few years … my only concern is jobs, you know, in case we find ourselves looking.

    (we’re expecting worse case, either way; goal is to have 1 year’s living expenses saved by year’s end)

  75. grim says:

    Love this one…

    From the AP:

    Casino big: Don’t discuss economy with gamblers

    Don’t discuss the economy with customers.

    That’s the recommendation from the head of the city’s Casino Association, who warns that talking with gamblers about how bad the economy is can be a losing proposition.

    Joe Corbo, president of the Casino Association of New Jersey, said Atlantic City casinos have been hit hard, just as other businesses have nationwide. In a monthly column in Casino Connection, Corbo says the last thing gamblers need to be reminded of is the tanking stock market or how much money they have lost recently.

    Making small talk with customers about the current national concern may seem like a good way to bond with them, but “not really,” Corbo says.

    “Our customers come here to escape. They don’t want to be reminded of declining 401(k) balances or investment portfolios,” he wrote. “If we engage them in discussion about the economy — or even worse, our personal circumstances — we’re reminding them of the very things they’re trying to forget.”

    Instead, Corbo recommends politely changing the subject and suggesting customers forget their problems and enjoy themselves.

  76. Sean says:

    Dubai and Debtors prison, I am so glad I talked my brother in law out of taking a job there last year.

  77. sas says:

    just got back from Tue night calisthenics & pushups.

    man, I feel good.


  78. sas says:

    I’m getting ready for my new assignment.

    I can’t wait.
    but, I will be here and there on blogosphere.


  79. Stu says:


    That Dubai read is incredible. I have an Indian friend from Chennai who worked there and loved it. I must forward the article to him and ask for his opinion on it.

  80. cobbler says:

    [73] sastry
    For the development purposes all the environmental samples are analysed by the EPA registered/certified labs; actually, the developer couid choose the lab, and I never heard about the fraud in the process – it is a federal crime, you get a long jail term. Procedure for taking samples is also quite rigid, you need a whole conspiracy to mess with it; besides, the state DEP could also double-check. Don’t worry – despite all the brownfield development incentives not much happens at really dirty sites.

  81. cobbler says:

    What I think makes the stats on affordability only marginally useful is the lack of granularity – it is especially bad for the state like NJ which has a zillion localities which were built over at very different times, and are quite segregated, less on race and more on class basis. Probably if you are looking at say Vegas suburbs you could use a very broad brush since almost all the housing in say 3 miles radius had been built within a 5 year timeframe and occupied by a fairly random group of people. Here, going to the extreme – how is affordability in Short Hills? Probably, excellent, since the average resident of SH is a high ranking WS person who [used to] earn enough not to have even a $2.5M house payments as a major expense. On the opposite end of the social spectrum, the thousands of new housing units built in the last 10 years in Newark have been totally unaffordable to the mostly low-income residents even when they’ve been built – this is why the city became an epicenter of subprime and mortgage fraud. When both places are lumped together in the stats for Essex county, you get the data which could be interpreted in whatever way the “interpreter” likes. Certainly, we have major price drops in both SH and Newark – but neither has anything to do with affordability changes.

  82. JBJB says:

    Why can’t you all be more like Lloyd Braun!!!!

  83. yikes says:

    kettle1 says:
    April 7, 2009 at 8:36 pm

    yikes 77

    gold dow….

    the funny part is, when you SAY what’s going to happen, it’s easy to laugh it off. (well, not me, but the commoners)

    and then when you see the chart … you realize where we’re headed …

  84. chicagofinance says:

    “TLC is currently casting for the fourth season of the cable TV network’s hit series Moving Up, hosted by Trading Spaces star Doug Wilson!

  85. Clotpoll says:

    BC (45)-

    Hey, a man can dream, can’t he? :)

    Best part of winning it all is getting e-mails all day from people from school I haven’t seen in ages.

  86. Clotpoll says:

    Anybody watching Real Housewives of NJ?

    Ipecac for the soul…

  87. Goldfinch says:

    RE: 749K house in Park Ridge

    Didn’t you see? It has QUOINS!

  88. firestormik says:
    April 7 (Bloomberg) — The Federal Reserve may offer investors longer-term loans at higher interest rates to buy commercial mortgage-backed securities, aiming to protect the central bank’s balance sheet while acceding to an industry plea.

    Lobbyists in the commercial mortgage-backed securities industry say the Fed needs to provide loans of at least five years, rather than the current three-year limit, to avert a meltdown in the market. Fed officials, wary of granting the request outright, are considering considering a compromise in altering terms of its $1 trillion emergency-lending program.

  89. PA Bound says:


    I don’t believe you when you say you pay 60% in taxes. It doesn’t matter how many states you are taxed in. Your overall income should be allocated or apportioned among those states. You should get a credit for those taxes paid to other states on your NJ return Maybe you have a bad accountant.

  90. Qwerty says:


    Those charts looks like front page njrereport material to me. You’ll want to provide your spreadsheet data to head off critics…

    kettle1 says:
    April 7, 2009 at 6:27 pm

  91. KareninCA says:

    an example of a realtor being honest (a post from burbed, the silicon valley site). los altos is an expensive town in this expensive region. “RBA” is short for “Real Bay Area”; what counts as such and why is the source of much amusement (e.g. for heavens’ sake Fremont and Daly City aren’t in it, despite geographic proximity). and as prices go down, the RBA shrinks! however, Los Altos so far safely remains part of the RBA.

    steve Says:
    April 6th, 2009 at 7:13 pm
    herve, well done indeed. a few random items:

    1)had an amazing conversation with a realtor holding an open house who explained why los altos has imploded and will only get worse. her take – los altos is a classic trade-up play and no one can trade up anymore because they have no equity in their current homes and can’t secure the financing required to buy $1.4-2.2M property. (any guesses as to what 90% of the property is los altos is worth?)

    she also suggested shadow inventory is huge and march was another terrible month for the RBA. she’s an old timer and says we’ve had many REOs in LA and MP before and we will have them again.

    2) also, chatted with the chief economist for a very major company. lots eye-opening statements about how bad things are, but the part that stood out is his (non-public) prediction that unemployment will hit 12%

  92. KareninCA says:

    also, what counts as class warfare on the NJRER is pretty wimpy. this recent post in Mish’s comment section is more like it. we are a pretty self-selected group here; so is Mish’s site. when people get desperate they can get fangy, and I don’t blame them:

    Home Grown says:3 days ago, 1:31:03 AM PDT
    Simpliy stated there are no new jobs. For those who have retained a job/career in this economy(which is the majority)be thankful. I live in Ohio(the heart of it all) jobs are few and far between. For those of us in search of a job the likleyhood of finding anything” close to the rate of employment we had before is nill.

    I see alot on this site that are better off than “WE THE PEOPLE” but the average dumb shluup is threw in this economy. I hope you with monies are ready too pay because we will not go down with out a fight. The fanancials need us more than we need them. We got the guns and the guts and we own this country not the elite and that is a fact.
    Like this comment? [yes] [no] (Score: 21 by 75 votes)Mark as offensive

  93. Essex says:

    96. That person is delusional. And cannot spell. A lethal combination.

  94. Stu says:

    “96. That person is delusional. And cannot spell. A lethal combination.”

    Sounds a lot like our last president.

  95. I like the info and will be linking back to you from my site. Also great looking site.

  96. Brook says:


    How to Beat the Home Buying Bubble of Over-Inflated Prices

    There is an answer to the astronomical rising prices of homes. Within our area, housing prices have more than doubled (and in some instances, have tripled) in the past 5-6 years for no reason except greed. People have put themselves into debt, because they did not want to lose a home because they became emotionally attached and in turn, took out a mortgage that a mortgage broker said they could afford -when in actuality they could not. I am a homeowner in Chatham and have lived here for most of my life. The realtors have strongly brainwashed homebuyers to purchase more expensive homes than they could afford and persuaded home buyers to take out huge mortgages in order to purchase a home. Due to the greed of the realtors, the homeowners who sold their homes, which accelerated into a false “supply and demand”, houses have escalated so much that middle class prospective homebuyers cannot afford to purchase a home. My children cannot afford to purchase a home.

    Greed has brought down Wall Street, Banks, Mortgage companies, and other large corporations. This is where we had to fall, in order to learn and know the important things in life. When I sell my home, it will be for the Pre-Real Estate Boom price: an average price where the middle class person can afford to purchase a home, easily. This will begin the lowering cost of homes. People are losing their homes and their jobs. Middle America cannot get over-inflated mortgages, any longer, nor do they want to. We have entered into an economic collapse.

    A colleague of mine has been looking to purchase his first home. Just to give you an example, in December 2002, the house sold for $210,000. In October 2008 (5 years later), the realtor has listed the home price as $420,000. Bear in mind, there has been a small amount of cosmetic work done to the home (nothing exceptional). The price has listed as more than doubled in the past 5 years, which is completely ludicrous. A doubling of a house price in 5 years is pure greed. This is just one of the many examples in this area of a 20 mile radius. Has your salary doubled or tripled within 5 years? No, in fact, many salaries have decreased in the past 5 years.

    When my colleague had questioned the realtor regarding the reasoning behind the over- inflated prices, she mentioned “it was for a reason.” She alluded to the statement to “keep particular people out.” I expressed to her how disgusting that was and at this time in history, someone actually had the audacity to express this sentiment. She was from a big conglomerate Realtor firm. Needless to say, my colleague dropped her as a realtor and strongly advises against recommending her company.

    People need to stick together and look at the “big picture” and look at their fellow man, instead of the most exhorbant amount of money they can put into their pockets.

    So, as homebuyers, there is a way to bring the prices of homes (Pre-boom real estate prices – 2001) to an affordable price.

    1) In the state of New Jersey, the cost of a sale of a home is public information. All records date back to the building of the home.

    2) Call the Taxation Dept. at the Borough Town Hall in the designated town. Give them the address of your prospective home and ask them all the sale dates of the home and what they sold for. You may want to know the last 3 or 4 home sales of the particular home in order to determine the inflated real estate boom market price and to determine a bid price.

    3) Bid according to the price BEFORE the Real Estate Boom Market. At the point of the Real Estate Boom Market – during and at its highest peak, these are over-inflated homes and they are simply not worth it.

    4) For example, the house that my colleague was reviewing, sold for $210,000 in December 2002. In October 2008, the realtor listed the price as $420,000. So, with the collapse of the economy; people losing their jobs and homes, coupled with the doubling over-inflated prices of homes, in order to bid for a home, bid closer to the 2002 price of $210,000 with an increase of a few dollars. Use your discretion.

    5) Do not be swayed by realtors. They are conniving, aggressive sales people, who are looking out for how much money they can put in their pockets. They are NOT looking out for your best interest, whatsoever. The most used phrase to attempt to condone listing homes with extremely high prices; even the most modest small/average home in the Chatham, NJ or the Morris County area, the realtor would say in that unconvincing wispy voice, “It’s C-h-a-t-h-a-m” or “It’s M-A-D-I-S-O-N.” You could sell a home in any neighborhood with those sales tactics and using that tone and connotation. “It’s W-H-I-P-P-A-N-Y.” Sounds the same, right? You understand the brainwashing techniques.

    There are homeowners in this area and the surrounding towns, who are able to sell their home for a reasonable price. Not everyone is greedy. Another friend of mine sold their home. This was at the beginning of the real estate boom. His house was listed as $750,000 by the realtor. He met a couple whom he liked. He expressed to the couple that he has been blessed with an average income and a wonderful family, and would like to give someone an opportunity. He sold his house for more than ½ the listed price at $350,000. Look at the possibilities. Do not listen to the negative people. Everything is possible.

    The more homebuyers use these tactics and stick to this principle, the more homes will decline in price, close to where they were before the Real Estate Inflationary Boom of Double and Triple prices. Soon, homebuyers will be able to purchase homes again at a reasonable price and not an inflationary false price.

    Good luck!

  97. Stock Forum says:

    Wish I had a site like this one, I will link back I think my readers would enjoy your site.

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