Who is to blame? Borrowers or Banks?

From Reuters:

Modification blunders bedevil U.S. housing recovery

Shirley Burnell, a community activist from Oakland, California, has been trying to get her subprime loan restructured since 2007.

She never missed a payment, but the adjustable rate mortgage she got in 2004 shot up to a monthly payment she could no longer afford.

First she provided documents without getting any response, then she was denied in April by her servicer, Bank of America (BAC.N), for not providing documents it never actually asked for.

As one part of the bank appealed that decision and approved her for a trial modification, another part denied her again – twice – providing two new reasons in part based on inaccurate calculations, according to documents reviewed by Reuters.

When asked about Burnell’s case, a bank spokesman said she was unable to qualify under “imminent default provisions,” a third reason that Burnell said she had never been given.

At one point, Burnell even received notice the bank would accelerate foreclosure proceedings, despite her perfect payment record and the letter itself saying the bank owed her $281.01.

“They gave you a funky loan in the first place, and now they’re refusing to work with people to get it worked out,” Burnell said. “It just keeps you upset all the time.”

Three years after the foreclosure crisis began, the process to apply for a loan modification remains a bureaucratic nightmare that is complicating the housing recovery and could dull the impact of any Obama administration initiatives in the works.

The administration’s biggest foreclosure-prevention effort, the Home Affordable Modification Program (HAMP), targeted to help 3 million to 4 million homeowners, has reached only about a quarter of that since its 2009 inception.

The program pushed mortgage servicers to cut interest, extend terms, or defer parts of a loan in an effort to reduce monthly payments and keep borrowers in their homes.

But servicers have dragged their feet on providing wide-scale modifications. They continue to lose documents, use inaccurate numbers to issue denials, or both approve and deny applications at the same time, according to housing advocates.

“It delays resolution of the problem of defaulting loans and it is adding uncertainty to the market,” said Susan Wachter, a housing expert at the Wharton School of the University of Pennsylvania.

Around one in every 12 mortgages in the country is delinquent, and only a fraction of them have received modifications.

“Somehow the borrower is unreachable, or the servicer hasn’t found the right way to reach the borrower, but the fact is, we see (modifications) piercing maybe 10 to 25 percent of the potential population,” said Diane Westerback, a managing director of global surveillance analytics at Standard & Poor’s.

“These are institutions that have taken a huge amount of bailout money. There should be a level of responsibility to communities,” said Josh Zinner, an advocate with the Neighborhood Economic Development Advocacy Project in New York. “HAMP is far from perfect, but the biggest problem is servicers not doing their job.”

This entry was posted in Economics, Housing Recovery, Mortgages, Risky Lending. Bookmark the permalink.

128 Responses to Who is to blame? Borrowers or Banks?

  1. grim says:

    From the Record:

    Paterson mill conversions slow, along with housing market

    Michael Stengart fell in love with the old silk mills of Paterson when he worked in the textile industry in New York. So after the coat factory at 175 Broadway shut its doors about 10 years ago, Stengart turned the five-story brick building into housing, just as other Paterson mills had been transformed.

    “It has tremendous potential as far as the quality of the building and the proximity to the railroad station, downtown Paterson and the Center City mall,” said Stengart, who put more than $7 million into a gut renovation.

    But the project’s timing was unfortunate. It opened in 2008, as the housing market was imploding and the financial industry was sliding into crisis. As mortgage money dried up, sales languished. Three years later, only 70 percent of the 48 units are occupied — a majority of them as rentals, with an option to buy.

    The Silk City project is an example of the housing bust’s profound impact on efforts to redevelop the old mills in Paterson. Those conversions started in the 1980s, when developers were first drawn to the massive brick factories. The buildings typically offer high ceilings, open spaces, solid construction and large windows that let light pour in.

    Many developers put in the extras that buyers crave, often including granite counters and hardwood floors. The result are often strikingly attractive properties that would sell quickly in hipper places such as Hoboken.

    But redevelopment of the Paterson mills has slowed to a crawl, as a result of lower demand, a difficult economy and a lack of financing. Getting a construction loan is “mission impossible,” Stengart said.

    McLoof, who has converted a number of the old mills in almost three decades in business, said he has no immediate plans for another mill project in Paterson.

    “As far as I know, no one’s doing anything right now,” McLoof said. And he thinks construction won’t return to normal levels for at least two years, because the large inventory of foreclosed properties is “a big cloud over the market.” Builders can’t compete with foreclosures’ low prices, McLoof said.

  2. grim says:

    Hard to convince buyers that a Paterson rebirth is on the horizon when the centerpiece of downtown is strip of bail bonds joints, pawn shops and a prison.

    Newark at least tried. Paterson? Sat on their hands and hoped.

  3. Fabius Maximus says:

    #2 grim,

    There was a townhouse development with great NYC views on the ridge just off Totowa avenue by the falls. I think I read that they finished them and then boarded them up as there was zero interest.

  4. grim says:

    I’m sure the sign said “Luxury”, probably the most misused word in all of multi-family construction.

  5. grim says:

    From the WSJ:

    Behind the Numbers: Builder Confidence Rises — Again

    Optimism has been in short supply for quite a while now in the battered home building industry. But a report Monday from the National Association of Home Builders brings evidence of a positive trend — or maybe just a less-than-gloomy one.

    The builders’ trade group said its housing market index rose for the third-straight month, increasing to a reading of 21 from a downwardly revised 19 in November. The index reached its highest point since May 2010.

    It was the first time since mid-2009 that the index increased for three months in a row. The results were better than expected, as economists polled by Dow Jones Newswires had forecast a reading of 20.

    All three components of the builders’ index increased, including a three-point jump in traffic from potential buyers. Sales expectations over the next six months and builders’ assessment of current sales conditions also grew.

    Despite the recent trend of increases, confidence is low from a historical perspective. A reading above 50 in the NAHB index would mean more builders view conditions as good rather than poor, and the last time the gauge was in positive territory was April 2006.

    Here’s what some industry watchers had to say:

    Ian Shepherdson, chief U.S. economist, High Frequency Economics: “The last time the index was close to this level, activity was being artificially boosted by the homebuyer tax credit, so to see the NAHB index rising strongly without policy support is hugely encouraging. It is not a coincidence, we think, that the index is rising at the same time the loan-to-price ratio for new mortgages is rocketing back to near-boom levels. As more people believe they can qualify for a mortgage on sensible terms, pent-up demand seems to be emerging. “

    Michael Rehaut, builder analyst, J.P. Morgan: “We continue to be somewhat surprised by this survey’s recent gains in the face of what overall appears to be still fairly to only slightly improving demand trends…As a result, we understand the survey’s gains of the past two months more as being driven by better (year-over year) order trends due to easier year-ago (comparisons) from last year’s pull-forward of demand from the expiring tax credit…However, we believe demand is stable to only modestly improving.”

    David Goldberg, builder analyst, UBS: “For the second month in a row the index was above the range bound levels it has been in for most of this year. We believe this supports our view that conditions in the new home market have bottomed. Further, our channel checks suggest that demand trends have accelerated into year end, outperforming normal seasonal patterns.”

    Eric Green, economist, TD Securities: “What we can take from the steady improvement in this sentiment measure is that housing activity is poised more for upward drift as opposed to downward drift. That may not appear too surprising given the record-low level of homes under construction, but what it does do is suggest that any slowdown in activity would be shallow and in an economy set to slow below 2% over the first half of 2012, the contribution from any sector that has a positive bias toward growth becomes more pronounced.”

  6. Mike says:

    Good Morning New Jersey

  7. NJ Toast says:

    Grim,

    Are you satisfied with WordPress and do you run it from a Windows or Mac and if you were selecting platforms for your blog again would you select WordPress again?

    Thanks,

  8. grim says:

    Absolutely would run WordPress again. Thought it was pretty much the de-facto standard in blogging now. I can’t imagine any other blog software having as deep a user base. I run it from my Windows Desktops/Laptops, iPhone, HP Touchpad, etc. As far as I know, the web interface will look pretty much identical on a PC or Mac. I’ve got friends who love the iPad client, but I can’t imagine typing anything more than a reply on a touch screen, and even that infuriates me (I’m a very, very fast typer).

  9. reinvestor101 says:

    I’m starting to get Eurozone fatigue. These damn people need to either go up or down and get this crap over with. I can’t stand the damn suspense and all this unpredictability. Either print the damn money or get the hell out of the damn way. Tell you what–we’ve got a lot of central banks that are nothing but a bunch of damn pantywaists. They need to print the damn money and I don’t give a tinkers damn how much they print, they just need to do it. The entire situation can be laid at the feet of the stinking real estate terrorists who started here but have gone global. Now with the new defense bill, they can be detained with impunity and I’d love to see that start happening.

  10. NJ Toast says:

    Thanks Grim,

    I appreciate the info. Sounds like anything other than WordPress is a mistake.

  11. grim says:

    Wiredtree is my managed hosting.

  12. BearsFan says:

    Toast, will chime in here since I’m in the field…Wordpress will always be an excellent choice, and likely the best…. but if you happen to be considering having your own custom design created and built, a WordPress integration (theme) can be a bit of a PITA as opposed to some other content management systems. But, out of the box, for blogging, WordPress is the best. If you were building a content rich site that also contained a blog, I would tell you to check out ModX. A lot of the basic blogging functionality that comes OOTB with WP can be easily replicated in ModX, and ModX makes a lot of other tasks for maintaining a website easier than WP, and integrating a custom front end is a breeze compared to WP. Sorry if too much info. Had to chime in, I get so much from this blog, trying hard to give something back :)

  13. Fabius Maximus says:

    #12 Bears

    To continue the topic. If you have a single theme with a few topics per day, wordpress is the best choice. If you need a lot of topics and threads and a multi forum based site, then look towards something like vBulletin.

  14. JJ says:

    I like wordperfect, I think I have it on a floopy somewhere.

    Saab is dead!! Where will George Castanza go for parts?

  15. grim says:

    I remember the days of the great forum experiment. Pretty much everyone here hated it. People expected the centralized discussion of the blog and thought the distributed nature of the forum was too scattered in comparison.

    I’m a big fan of forums, but the purpose and dynamic are very different.

    Question to ask yourself is whether you want users to drive content or do you want to drive yourself. Also, building critical mass with a forum is much more difficult than a blog, especially of you are not the first mover in the space.

  16. freedy says:

    Housing starts are up. Hurry ,buy now and don’t be locked out. Grim:How does the
    spring 012 selling season look?

  17. TB72 says:

    Perhaps it is next to the Stroker 64 diskette.

    I like wordperfect, I think I have it on a floopy somewhere.

  18. JJ says:

    More new housing starts is bad for re prices. Adding new housing stock when you can’t sell existing housing stock will drive prices further down. Further if builders got land cheap in a distress sale and can build a house cheaper than 2006 as contractors will work for less next thing you know you have brand new construction priced the same as existing houses that need work. You know where this leads, existing homes need to lower prices.

    freedy says:
    December 20, 2011 at 8:31 am
    Housing starts are up. Hurry ,buy now and don’t be locked out. Grim:How does the
    spring 012 selling season look?

  19. Libtard in Union says:

    Forget WordPerfect. I’ve got WordStar running on an old Kaypro.

  20. gary says:

    Can anyone divulge who this Bon Jon Bovi character is and the relevance of his existence or lack thereof?

  21. JJ says:

    Serious Question of the day. This one is for the working Moms. I have a staff member who had her fist kid in early October. Plans to take max materiity leave as she is combining it with vacation days, bank days etc. Won’t be back till late Feb. So that is almost five months. She has a mobile device to check email and can access her work pc from home if she felt like it.

    My questions is how often should a women home on a long maternity leave check in at the office. She sent like a one sentence email after kid was born with the details. Then out of blue another two sentence email saying she is very busy at home with kid as it is a lot of work. Thats it. No asking about work or anything, No asking about how the projects she left unfinished turn out.

    Now I don’t think much of anything but another staff member out of blue says I don’t think she is coming back. She seems to be sending signals I could not tell you I wont be coming back as I want to get paid maternity leave and get my full year end bonus, 401K match etc. and keep option open to come back.

    What do you ladies think. Are first time mothers overwelmed? After staff mentioned her lack of interest I was thinking if I don’t at least get a one sentence email around xmas or new years saying happy holidays she is sending a signal she is coming back to resign or start angling to see if she can get a package.

  22. grim says:

    Spring 2012 looks like shit frederick.

    I said the market wasn’t going down, I didn’t say it was going back up, there is a major difference there. We’ll stew in this shit for years until we all collectively forget what happened, we then rinse, and repeat.

    I just don’t see another big leg down for housing. Being on the precipice of world financial meltdown and zombie attack barely nudged the market, whats the driver behind another 20% drop?

    Look, we’re hitting the numbers I predicted back in 2005, almost 7 years back. Everyone called me an idiot for my 30% down calls.

    You can call me an idiot today too, but my track record for housing tends to be more right than wrong.

    Was I wrong in timing? Absolutely, I blew that so bad it’s a joke. It took 7 years to hit numbers I though we’d hit in 2 or 3.

    Timing is the call that everyone seems to have gotten wrong, as there is some expectation that the accelerations in timelines we’ve seen in other asset markets would apply here. This ship is slow to turn.

    Even if you expect a big drop in the markets due to foreclosures, expect it to take another 7 years to play out.

    In the end we all get screwed, the house always wins, no pun intended.

  23. Libtard in Union says:

    JJ,

    I’m not a lady the last time I checked, but I would bet anything she ain’t returning. How does her husband do? If his career is going well, you have your answer.

  24. NJ Toast says:

    I appreciate all the info, comments and perspectives. In theory, it will be a site for job networking, insider perspectives on company culture and a slew (yet to be determined) of other career related things. Some content from me, but hopefully a lot from visitors.

  25. grim says:

    If I had to bank on a negative prediction, Chip’s theory of a dead market for 20 years has a much higher probability than a quick 20% drop over the next 2 or 3 years.

  26. JJ says:

    In this case her hubby is not a factor. She does not have to work. In fact even before kids he would rather have her home doing the Cleaning, Cooking and Fu, well you know. At first I thought she would come back as she told me she is too lazy to be a stay at home mom, perfer to sit behind a desk push a few papers around and have a nanny and/or maid do the real work of raising a child. But who knows I guess I wait and see.

    Now back to real estate, CRASH, CRASH, CRASH NJ is the new Cleaveland.

    Libtard in Union says:
    December 20, 2011 at 8:58 am
    JJ,

    I’m not a lady the last time I checked, but I would bet anything she ain’t returning. How does her husband do? If his career is going well, you have your answer.

  27. gary says:

    I just don’t see another big leg down for housing. Being on the precipice of world financial meltdown and zombie attack barely nudged the market, whats the driver behind another 20% drop?

    What was the catalyst for the first 30% drop? Who’s to say it’s done? Sure, maybe another 5 or 7 years to go. Salaries have deadlined for 10 years and no job growth as everything… and I mean everything continues to rise unabated. In the immortal words of Wantanbee: Sell? Sell to whom?

  28. yo says:

    Buyers are buying brand new homes than the used ones.Builders give incentives,free finished basement for the price of a 5 year old in my development

    JJ says:
    December 20, 2011 at 8:42 am
    More new housing starts is bad for re prices. Adding new housing stock when you can’t sell existing housing stock will drive prices further down. Further if builders got land cheap in a distress sale and can build a house cheaper than 2006 as contractors will work for less next thing you know you have brand new construction priced the same as existing houses that need work. You know where this leads, existing homes need to lower prices.

  29. JJ says:

    I say neither the borrowers or banks are to blame. They had good intentions. It is the National Association of Realtors, Mortgage Brokers, Real Estate Agents and the greedy Sellers that caused the problem.
    The borrowers and banks got screwed and stuck with big losses. The sellers pocketed 94% of the stolen loot and the realtors pocketed 6%. Plus mortgage brokers fees sucked money that could have been used for a larger down payment.
    There should be a “claw-back” provision in any principal reduction where by the bank, seller, realtor and mortgage broker should all chip in.

    I think we should have a look-back provision wherby any real estate commission or mortgage broker fees paid should be clawed back for any home that defaults within 36 months due to any suitability issues at time of purchase by the buyer.

    Who is to blame? Borrowers or Banks?
    Posted on December 20, 2011 by grim

  30. yo says:

    I say our leaders are to blame.The Fed had the power to start and burst bubbles but Greenspan and Bernk decided to keep quite.Then you got Rubin ang GWB coming out all proud”this Country have never seen so many homeowners”

  31. JJ says:

    If you theory was true why were homes prices rising quickly in 1999 and 2000 when rates were rising. Also why aren’t home sales rising in 2011 with record low mortgage rates. I think the Fed could have popped bubble earlier. But remember Fed was the one who did eventuallly pop bubble in 2006 and 2007 by raising rates several times.
    But why did Fed let bubble inflate in first place in 2002-2004, it was internet bubble collaspe and the attacks on WTC that plunged the economy into a near depression.

    Bottom line Steve Case and Bin Laden caused the housing bubble.

    yo says:
    December 20, 2011 at 9:26 am
    I say our leaders are to blame.The Fed had the power to start and burst bubbles but Greenspan and Bernk decided to keep quite.Then you got Rubin ang GWB coming out all proud”this Country have never seen so many homeowners”

  32. gary says:

    Who is to blame? Borrowers or Banks?

    The signing of NAFTA was the first head shot. Then, the repeal of Glass-Steagall turned the banks into Casinos delivering the final blow.

  33. yo says:

    Wide losses on internet bubble the Fed had to make us feel rich again ,started the housing bubble by 2004,everybody feels rich and smart,GWB started taking credit for it and Greenspan was called the smartest man in the world.

  34. JJ says:

    Bill Clinton propped up Fannie and Freddie to make mortagages available to all and for banks to stop redlining and enourage minority ownership regardless of credit risk. Bush was just a buffoon who inherited a country set to have a housing bubble pop and an attack on 9/11 since Clinton cut the military budget too. Clinton played a game of eight years of great when I am president and let the next president deal with it. Bush wasnt the sharpest tool in the shed so unlike Obama he could not spin it.

    yo says:
    December 20, 2011 at 9:47 am
    Wide losses on internet bubble the Fed had to make us feel rich again ,started the housing bubble by 2004,everybody feels rich and smart,GWB started taking credit for it and Greenspan was called the smartest man in the world.

  35. The Original NJ Expat says:

    Wouldn’t it be funny if Paterson changed it’s name to East Woodland Park?

  36. gary says:

    Expat [35],

    LOL!!

  37. Comrade Nom Deplume says:

    [34] JJ

    “Bill Clinton propped up Fannie and Freddie to make mortagages available to all and for banks to stop redlining and enourage minority ownership regardless of credit risk. Bush was just a buffoon who inherited a country set to have a housing bubble pop and an attack on 9/11 since Clinton cut the military budget too. Clinton played a game of eight years of great when I am president and let the next president deal with it. . . .”

    Pretty much dead on. From my perspective, I was literally in the room (or on a conference call) when bank regulators under Clinton, and later Bush (same regulators, BTW), pressured banks to make “commitments” to low income lending if they wanted to see their bank mergers approved. It was literally akin to pay-to-play except the money went to mollify bank critics who were also regulator critics. In effect, the regulators bought off the low income crowd with the bank’s money.

  38. The Original NJ Expat says:

    I just googled that, I guess that joke is years old. Apologies for my mind working so slowly.

  39. yo says:

    It is the policies of our leaders that will always define our lives.Some will say they want small government.This can never happen unless we want to go back to the age of cowboys.They can make or break Chaos.The problem with politics today is passing the buck to the next one as long as they do not have to deal with it.We have seen this to all the Governors of this state since I came here in 84,except for CC.

  40. Shore Guy says:

    John,

    Legally, being out to have a kid then spend some time with it after the birth is the same as having a heart attack and then having some time to recover. There is no obligation to check in, nor should you expect it. When she comes back, she does the job or she does not; at that point she should be treated like anyone else who came back from any other medical leave. If you make the mistake of looking down on her or treating her differently because her absence was child-bearing related, you might as well open the checkbook and buy her a condo in the Virgin Islands. It will save you, her, and the company time, money, and effort.

  41. Shore Guy says:

    “Some will say they want small government.This can never happen unless we want to go back to the age of cowboys.”

    This is simply not true. There are plenty of things that government is doing that it need not do. Many of these things are worthy and they benefit society. That said, just because something is beneficial does not mean that one should spend money on it.

  42. Painhrtz - I ain't dead yet says:

    Expat since my in laws live in woodland park and I hadn’t heard that I lol’d

  43. Shadow of John says:

    “forum based site”

    I remember sitting in the back seat of my dad’s limo, drinking scotch with Ted Kennedy and his bimbos as he read Forum to the girls and daring them to try the things in the letters. Ahh, the days of wine, roses, vomit,
    and crush velour.

  44. Libtard in Union says:

    Forum. I remember that fondly. I always read it, just after looking at the pictures.

  45. The Original NJ Expat says:

    Forum. I remember that fondly. I always read it, just after looking at the pictures.

    I hear they have an app for that now;-)

  46. Anon E. Moose says:

    Shore [41];

    I forget the name, but there is a school of philosophy (as applied to government) that would choose the rules if the chooser were blind to where they stood in society — for example they wouldn’t know whether they were paying for welfare benefits or recieving them. Purely hypothetical, of course, but kind of makes sense to me. And, I think, leads to a far more minimalist social safety net (provide food and shelter, not cell phones and cable TV).

  47. The Original NJ Expat says:

    #34 JJ – Bill Clinton propped up Fannie and Freddie to make mortagages available to all and for banks to stop redlining and enourage minority ownership regardless of credit risk.

    I don’t have proof at my fingertips, but I’ve heard tale of Clinton sicking Janet Reno on a couple of the mid-size, politically unconnected, redlining banks just to show the rest that he was serious about buying votes in wholesale quantities in exchange for “the American Dream”.

  48. grim says:

    35 – Re: Woodland Park

    Was it really a surprise? About time. East Paterson changed their name way back in ’72 (Elmwood Park for those that don’t remember it). Woodland Park wasn’t even creative in their approach. They should have just renamed it Hollywood and put the letters up on the cliff over the Hovnanian development to boot.

    Split Paterson down the middle and rename half Elmwood Hills and the other half Woodland Valley, screw them both over.

  49. Shore Guy says:

    What is with 287 by Morristown?

  50. Libtard in Union says:

    Small plane crash in Harding. On median of 287. Highway closed. Apparently, the pilot was reading the Forum.

  51. Kim says:

    Small plane crashed on 287 near Morristown… 3 unconfirmed dead…

  52. Shore Guy says:

    Moose. I am all for that approach.

  53. NJGator says:

    Does anyone remember that before there was Woodland Park, there were attempts to change the name to “Whispering Pines”, “West Park,” and “Garret Mountain” in 1989, 1995, and 2001 respectively.

    http://en.wikipedia.org/wiki/Woodland_Park,_New_Jersey

  54. Libtard in Union says:

    I would have preferred the name, ‘Mrs. Garret Mountain.’

    “Now girls…”

  55. gary says:

    The should’ve named it West Lodi; there’s plenty of Italians there. ;)

  56. JJ says:

    Pretty much anyone out on disability in this economy I think should check in at least once a month with a two second email or a card at holiday time. My friend at Chase had knee surgery that kept her out longer than expected. She went out of pocket completely on the leave and burned the bridges. She came back and was pushed out. She regrets not playing the game by maybe doing a little bit while out or at least checking in. She admits she was burned out after working 25 years and wanted a few month break from corporate life to enjoy. Sadly at 52 it appears she is on a permanent break.

    maybe we should buy all women on leave a condo anyhow, it certainly would help the real estate crisis. Two houses for every couple!!

    Whole thing reminds me of back in the early 1990s at PwC when my friend said his wife just gave birth and ask Partner for some time off during busy season. Partner said just cause you F$$Ked your wife doesn’t entitle you to paid time off. Flash forward to 2011 and PwC has super generous manternity leave.

    Problem is flex time, manternity leave, telecommuting, no traveling restrictions, employer of choice initatives is they beat up single people, Dads with stay at home wives, and older workers with grown kids. It makes 50% of workers happy and 50% of workers resentful.

    Kinda like real estate happy sellers, sad buyers.

    Shore Guy says:
    December 20, 2011 at 10:28 am
    John,

    Legally, being out to have a kid then spend some time with it after the birth is the same as having a heart attack and then having some time to recover. There is no obligation to check in, nor should you expect it. When she comes back, she does the job or she does not; at that point she should be treated like anyone else who came back from any other medical leave. If you make the mistake of looking down on her or treating her differently because her absence was child-bearing related, you might as well open the checkbook and buy her a condo in the Virgin Islands. It will save you, her, and the company time, money, and effort.

  57. Anon E. Moose says:

    Plane down on I-287.

    It was a single engine turboprop. I saw the radar track; he was just out of Teterboro, destination was down south somewhere. He abruptly turned 180 towards Morristown airport. Didn’t get there obviously. No indication yet of why he diverted.

    Star Ledger pics are scary, esp the hulk of the engine sitting in the highway. (photos.nj.com/star-ledger/2011/12/crashzip_2.html)

  58. seif says:

    whatever happened to the feature “Comp Killers?”

  59. Anon E. Moose says:

    seif [58];

    They’re all “comp killers” now.

  60. Comrade Nom Deplume says:

    Speaking of kids and work, I am setting up a common tax technique (Fabius would call it a dodge) whereby I hire my 8YO to do some work for my practice. In this case, it’s empty the trash and recycling, for which she gets $10 per week.

    This complies with NJ min. wage laws and is exempt from child labor laws.

    This sets up an income shift from my marginal rate to hers. Since I am custodian for her money, she will be funding a Roth IRA with it. Best part is that there is a FICA/FUTA exemption for her, and no Kiddie Tax.

    And, at least for now, qualified retirement plan assets in either a parent’s or child’s name are not factored into financial aid.

  61. Comrade Nom Deplume says:

    [61] redux

    And since her marginal rate is effectively zero, it means that money will, in theory, never be taxed at the federal level.

    I’d pay more but there is a reasonableness requirement. Paying her $100 per hour to take out the trash probably won’t pass that test. Though in JJ’s office, it might because of all the extra services being performed.

  62. Comrade Nom Deplume says:

    Not that my daughter will ever work in JJ’s office, even at 18+

  63. Comrade Nom Deplume says:

    [57] moose,

    That mess up your commute? Or is this a NY day?

  64. Bystander says:

    JJ,

    Well NOW got the 2 income household that they fought for. Capitalism/consumerism expanded to make it a trap. Now companies have to respond to working parent needs. Did you know that fathers can take paternity leave? Guy at work just got back from three months paid. Wife gave birth in May and she was off until Sept. He took off from Sept. until yesterday. Interesting to see if company gets rid of him now.

  65. JJ says:

    Actually it has been drilled in my head these last ten years to be PC and walk on eggg shells around women, give then good raises, bonuses, flex time etc. It is worse to work for me as a a guy as I am not as constrained.

    Comrade Nom Deplume says:
    December 20, 2011 at 1:04 pm
    Not that my daughter will ever work in JJ’s office, even at 18+

  66. Libtard in Union says:

    Holy Santa rally!

  67. Libtard in Union says:

    Nom…Can I get a job?

  68. Anon E. Moose says:

    Nom [64];

    NJ today. Its close, but south of me. I was safely in the office before it happened. Didn’t even know about it until murmurs started swirling around the office. It shouldn’t affect my ride home tonight (God willing), and if it does, it won’t for long as I’ll be going away from [what’s left of] the problem.

  69. gary says:

    What do you guys and gals think of iShares Dow Jones Select Dividend Index (DVY)? It’s currently paying 3.49% yield.

  70. gary says:

    Bystander [65],

    It all doesn’t matter. The 85 positions that were chopped in the last 4 months at my location have all been replaced by temp (contract) work. 50 were business positions that went to Singapore and the 35 here are now QA and Development positions filled by people from India on work visas. I keep trying to tell everyone all corporate positions will eventually be temp so these so-called perks are going to be a moot point.

  71. Bystander says:

    Agree, Gary. That is why you should take any perk while you can. It won’t be there next time. Same story here. Positions being bumped to India. Importing cheap visa candidates to fill consultant jobs. Back and middle office positions are toast.

  72. gary says:

    Bystander,

    The only perk I have right now is that I have a great boss! It’s been a long, long time since I’ve had a human being as a boss. Other than that, the rules are the pay is per diem only. My boss can’t control it, wishes he could and he asks every week to convert me.

  73. Nicholas says:

    Reasons why housing isn’t at a bottom from yesterdays thread…

    a) demographics (# of people turning 63 daily is sky high)
    b) borrowing costs at all time lows
    c) rental costs (taxes) slowing with adjustments but we’ll see rates adjusted soon
    d) and we’re beginning a massive wave of stagflation

    I think that your point (a) doesn’t take into account that immigration is keeping the population of the US steady. It doesn’t really matter that Americans turning 65 is at an all time high what matters is the population of the United States (which includes immigrants and illegal immigrants).

    A shift in thinking has resulted in most people becomming unconcerned with just managing a payment. I don’t go into a car dealership thinking I can afford xxx dollars per month, how can I maximize luxury? The mentality has changed and maxing out leverage isn’t the primary goal of home buyers today. Thus (b) doesn’t hold as much significance as you think.

    I’m not sure that (c) is equally distributed among the national housing market and perhaps might even be very local. I also believe that (d) is conjecture and primarily is a function of treasury and federal reserve which we know to be unpredictable.

    Thus, there is a possibility that we are at the bottom in house prices. Of course we won’t know until another 12 months of data comes out. We may not be at the inflation adjusted bottom in house prices and that would be harder to determine.

    Like I indicated yesterday, I have determined to hold out one more year because in the areas I track there is strong indication that we are not at a housing bottom.

  74. A.West says:

    Anon (46),

    I think you’re thinking of Rawls’ “Veil of Ignorance” argument. It’s used by socialists/communists to justify redistribution of wealth. Their assumption is that if you think there’s a chance you might be “born” poor, dumb and/or lazy, then you will favor heavy redistribution, massive welfare statism, etc.

    What they don’t consider is how trading liberty for compulsion shifts everyone’s potential downwards, leads to a society which resembles the movie “Idiocracy”, and suffocates the most creative and productive individuals.

    http://en.wikipedia.org/wiki/A_Theory_of_Justice

    As Ayn Rand wrote:
    “The new “theory of justice” [of John Rawls] demands that men counteract the “injustice” of nature by instituting the most obscenely unthinkable injustice among men: deprive “those favored by nature” (i.e., the talented, the intelligent, the creative) of the right to the rewards they produce (i.e., the right to life)—and grant to the incompetent, the stupid, the slothful a right to the effortless enjoyment of the rewards they could not produce, could not imagine, and would not know what to do with.”

  75. J La says:

    Re: 21 John, being a first time mother is so overwhelming. Especially, if new mom was full time career gal. That said, on leave she may feel that work will take care of itself. She assumes she has the job to come back to, so why bother checking in. Could be a work ethic thing too. Some people think the world will end if they’re not there to do their job, others feel the company started without them and can certainly get along in their absence.

    She said it’s easier to work and have nanny etc., raise kid, so maybe she’s just trying to keep her options open.

    As for you using whether or not she reaches out to you for the holidays, don’t bet on it. Having a baby is crazy enough, and throwing the holidays on top of that, puts you even lower on the priority list. Although who can figure out why, when you’ve always been such a champion of the working mom.

  76. Anon E. Moose says:

    A [75];

    Yeah, that’s it. Then again, I guess that’s why I’m not a socialist. I’d just as soon use it to argue for a less generous social safety net — you wouldn’t know whether you are being asked to pay for four single mothers who can’t spare a nickel of their $40k income to pay a tax or two (just to pull a completely random but real example from a recent conversation I had with a self-effacing, but no less staunch socialist).

    Its all Angels dancing on the head of a pin anyway, impossible to implement.

  77. JJ says:

    Thank you for the words of wisdom, I truly am a champion of the working mom. I go overboard with being nice to women at work. Too much. It is a result of my Mom working full time to support our family after my Dad died and seeing the stuff she had to put up with. When I was invited to the Women on Wall Street meeting one year as I am such a great benefactor of working women and found me one of maybe three men in a room of 500 women I realized I went to far.

    To this day I find the whole maternity thing working women have hightly amusing. A stay at home Mom with four kids gets out of hospital and comes home to filthy house and piles and piles of work. She is back at work within 30 minutes of being released from hospital. A working mom needs a few months to recover before she can sit at desk and surf the web and send some emails. The govt should really give stay at home moms materinity leave. Give them a break for three months with pay like the “workin gals”.

    J La says:
    December 20, 2011 at 2:06 pm
    Re: 21 John, being a first time mother is so overwhelming. Especially, if new mom was full time career gal. That said, on leave she may feel that work will take care of itself. She assumes she has the job to come back to, so why bother checking in. Could be a work ethic thing too. Some people think the world will end if they’re not there to do their job, others feel the company started without them and can certainly get along in their absence.

    She said it’s easier to work and have nanny etc., raise kid, so maybe she’s just trying to keep her options open.

    As for you using whether or not she reaches out to you for the holidays, don’t bet on it. Having a baby is crazy enough, and throwing the holidays on top of that, puts you even lower on the priority list. Although who can figure out why, when you’ve always been such a champion of the working mom.

  78. Anon E. Moose says:

    More on that plane down, from Bloomberg.

    http://www.bloomberg.com/news/2011-12-20/greenhill-says-two-managing-directors-believed-killed-in-n-j-plane-crash.html

    Based on commuter airline reports in the area at the time of the accident, icing may have been a factor.

  79. Mike says:

    From MSN Money: Most of the gain for starts and permits came in multi-family construction, up 32.2% from October and up 181% from November 2010. The reason is that many people are choosing to rent either because they don’t want the risk of home ownership or can’t qualify for a mortgage.

  80. gary says:

    Mike [81],

    They can’t qualify for a mortgage. 20% of nothing is nothing.

  81. PGtips says:

    74 Nicholas

    I see the leg next down forming in the areas I am looking, too. The inventory is the highest I’ve seen the last few years. Plenty of houses for sale in Millburn, westfield, etc nothing above 600-700K is moving unless in impeccable condition. Places like South orange and Montclair are on verge of collapsing. I can’t imagine what will happen when more houses go for sale in spring.

    To the factors that Bearsfan mentioned add
    1) property taxes doubled and will continue to go up
    2) wages for the middle class buying those houses are stagnant
    Although rates are low taxes/higher maint negate any gains. We have seen the price to income ratio this market needs to clear out. It needs to go back to the 1998 or so. Of course it might take a few years for this correction but it will. As for the “inflation” correction some advocate, it won’t work as wages are low and rents have to stay low so even if there is money, re will not be a profitable investment.

    Buying now is a mistake. Don’t fall for the “buy now or priced out” or even for the milder “buy now because prices go nowhere and you will be a proud homeowner”. Let the banks/agents/flippers take the hit.

  82. t c m says:

    #21 – JJ

    Her behavior now is no indicator of whether she will return or not. When I was out o maternity leave three different times, I rarely checked in (although this was before e-mail! maybe that would have been the difference). In any case, I was pretty busy and distracted with the kids and work seemed far away – for each leave. I went back to work twice and quit the last time.

    Ditto for money – When I left it caused a pretty big financial strain. On the other hand, I know women who were extremely wealthy who chose to continue to work after maternity leave. You just don’t know.

    Maybe one of the best indicators is if this is a second or third child. Even then, assume she’s coming back. It will keep you from any type of liability.

  83. Libtard in Union says:

    Gary (70): DVY

    Someone else in the blogosphere I follow recently mentioned it positively. You could do worse.

    Why don’t you join the old investment club ol’ chap and make money for yourself. We are still looking good. Hoping Dink joins us in January. Victorian came and went unfortunately as he now works on the Street and can’t invest.

    https://www.bivio.com/hn/mlic-benchmark-report.html

  84. Fabius Maximus says:

    JJ

    Have you tried reaching out to her. Give her a call as a “How’s things going and Happy Holidays”, might swing the decision to stay on, or get you better numbers in your 360 review or give you a defense in the lawsuit.

  85. gary says:

    Libtard,

    I’ll email you later.

  86. Confused in NJ says:

    Mexico Mayan region launches apocalypse countdown

  87. grim says:

    I see the leg next down forming in the areas I am looking, too. The inventory is the highest I’ve seen the last few years.

    What inventory are you looking at? Inventory sucks right now. Slim pickings heading into this winter compared to last year. Ask anyone really looking what they think of inventory right now.

    GSMLS – November Active Inventory

    Morris
    2006 – 4721 (bubble peaks, just for reference)

    2010 – 4400
    2011 – 3847

    Essex
    2010 – 3984
    2011 – 3676

    Passaic
    2010 – 2811
    2011 – 2793

    Somerset
    2010 – 2719
    2011 – 2655

  88. JJ says:

    I gave her a good bonus while she was on materinity leave. Five months paid maternity leave and a bonus of 40% of her full year base salary in a year in which at best she got six months of work done. Would love a 360 review from her.

    wont call or email due to I know better. girl does not celebrate either holiday so I also know better than to wish her happy holidays.

    I am assuming she is coming back, just worried telecommuting, FMLA, sick days for sick chiled, can I leave early for this or that. I know the whole grab bag of excuses are going to take place. Like a new puppy, a new first time mom back at work needs to be taught just cause you had a kid the world does not revolve around you. Also your husbands job is not more important than your job, don’t be taking off 100% of time while you have stuff to do with kids while husband never takes off. Also don’t ask to work from home, telecomute, flex time, leave early and all mumbo jumbo so you don’t have to use vacation days and then take vacation days. That ends up being a pain to me and work does not get done. It is a shame that people go back to get MBA, have kids, buy a house, have a sick Mom etc. Things all of us go through and when other people went through these issues they could care less, but when it happens to them the world must come to a stop.

    Funny look at the people who were first time home owners in the period of 2003-2008 who are not defaulting. The bunch I saw on 60 minutes. Guess what back in 1989-1993 there were scores of foreclosures and people out in the street, did they care, no they did not as it was not happening to them.

    Article in WSJ today about how back office factory workers were loyal to company and boss, military training etc. thought people to follow and leaders to be leaders. Today not so much. The kids today don’t respect authority. We give flex time, 401K matches, tuition reimbursements and internet access and god forbid they stay one minute late. In my day the boss marched up the aisles of my office barking orders and we jumped as we knew one day I would be marching the aisle barking orders. Today kids don’t want to be barked at or be the barker. Well guess what either run with the big dogs or go home. This applies to real estate, investing or being a Mom.

    Fabius Maximus says:
    December 20, 2011 at 3:39 pm
    JJ

    Have you tried reaching out to her. Give her a call as a “How’s things going and Happy Holidays”, might swing the decision to stay on, or get you better numbers in your 360 review or give you a defense in the lawsuit.

  89. JJ says:

    Well add in shadow inventory from banks and add back in any listing from 2009/2010/2011 that expired unsold and you have a lot of inventory. I know a boat load of houses where owners could not sell and pulled listing. They still want to retire and move and at first slight chance of recovery they will re-list preventing the market from having any lasting upward trend in prices.

    grim says:
    December 20, 2011 at 4:10 pm
    I see the leg next down forming in the areas I am looking, too. The inventory is the highest I’ve seen the last few years.

    What inventory are you looking at? Inventory sucks right now. Slim pickings heading into this winter compared to last year. Ask anyone really looking what they think of inventory right now.

  90. joyce says:

    90
    You said a lot things in there i agree with. The part about respecting authority I also agree with accept to add it takes respect to get respect. That goes for my boss and the police officer.

  91. Fabius Maximus says:

    #62

    The board may need to be careful with this. The information as presented will not meet the IRS standards. While Eddie Ray may meet the reasonableness requirement, he does not meet the necessity requirement. The job the kid does has to be necessary and essential to the business. Paying them to take out the trash or recycle or vacuum the carpets does not qualify as it is not essential to the business.

    Now he could pay them to collate files or photocopy records, but at that point he needs to show that the kid has the skills to do they job. Can an 8YO be considered to have the skill set to operate a photocopier unsupervised without destroying files.

    I would say consult an expert, but ….

  92. grim says:

    Well add in shadow inventory from banks and add back in any listing…

    Yeah, yeah.

    And back out every overpriced listing with a lien so high the bank will never approve, back out the seller’s stuck in 2005, back out the sellers who don’t think high tension lines, being next to a gas station, flood, etc are a problem, since it wasn’t a problem when they bought, back out the sellers that can’t be bothered to clean up the piss and feces on the bedroom carpets, back out the POS Crapshacks, back out the in-ground oil tanks, back out the 1960’s dream homes (where the sellers still think the place is someone’s dream home), back out the half-ass flip jobs, etc etc.

    80% of the homes on the market are not for sale, period. Yes, they are listed, but they are not for sale (see above).

    14% of them are for sale, at prices that are on the verge of inducing a rage

    5% are decent, but not compelling to make someone jump

    1% are priced well, and disappear in near instantly (1-2 weeks)

  93. t c m says:

    #90- JJ

    “I am assuming she is coming back, just worried telecommuting, FMLA, sick days for sick chiled, can I leave early for this or that. I know the whole grab bag of excuses are going to take place…..”

    Yes, going home early for a sick child is going to happen. Just be sure that you don’t have a double standard. I worked on a trading desk in one of the biggest Wall St. firms when I went back to work. When I would get a call that I had to leave because one of my kids had a fever, or whatever, I knew there was grumbling. The double standard was that very often, the guys on the desk that worked with me would duck out a lot. After trading, they would leave their jackets on the chair, and just leave for drinks, golf, home, whatever. A lot of people thought it was funny – there was no grumbling by management. But make no mistake, I knew it and other people did too. People notice this stuff.

    So, if you’re going to give someone a problem for leaving early for a sick child, you’d better be sure that everyone else’s a$$es are in their chairs all the time – otherwise, you’re in for a well earned lawsuit.

  94. grim says:

    Of the remaining 20%, 1/3rd are in shitty areas and 1/3rd are above 750k with $15k+ tax bills.

    That leaves just about 7% of active inventory as actually being salable/realistic/achievable.

    Does anyone who is really looking think I’m off my rocker here?

  95. grim says:

    For all those mid-century fans out there, it appears 11 Bott in Montville might actually have caught a bid!

    2007 ask was $599k.

    Last asking price


    wait for it.

    $239k!

    This is under the 1995 purchase price of $250,000, the ask!

    Under 1995! Really wondering if the sale price is going to carry a 1-handle.

    I’d say comp killer extraordinaire here, but this property is on 287, without the sound wall. Didn’t get winterized last winter, and as a result it looks like a number of pipes/fixtures burst.

  96. NJ Toast says:

    And some people are just hitting the road and leaving the coasts. At a party this weekend with a couple of bankers, both would be well compensated types who expressed a desire to leave sooner rather than later from the area.

    Cost of living + taxes + daily hassles = need to leave

    http://www.bloomberg.com/news/2011-12-20/u-s-population-migrates-for-income-boost.html

  97. NJ Toast says:

    On the subject of housing prices, for those who believe we have hit bottom, how can you say that?

    With high unemployment, a feeling if you are employed your job is always at risk, minimal wage increases, europe, debt, demographics … seems like we still have a way to go.

    As unemployment dries up for many and they burn through their life savings, the level of poverty among the unemployed I would think will rise dramatically in 2012.

  98. homeboken says:

    grim says:
    December 20, 2011 at 4:48 pm
    Of the remaining 20%, 1/3rd are in shitty areas and 1/3rd are above 750k with $15k+ tax bills.

    That leaves just about 7% of active inventory as actually being salable/realistic/achievable.

    Does anyone who is really looking think I’m off my rocker here?

    Grim – Agree with 100% of this and previous post, we are clearly in a very broken and distorted single family home market. Knowing this, how can you call a bottom when there is essentially no market to speak of?

  99. Anon E. Moose says:

    WWI pilots used to carry a pistol with 1 round. The fabric wings were very flamible and the airframe was unlikely to survive a crash landing. Ergo…

    The truly compassionate sellers include a velvet rope.

  100. PGtips says:

    89 grim

    thanks for the inventory numbers you mentioned. However, the numbers do not mention the price range. Do you have the numbers for individual towns such as westfield, millburn for a price range 300K to 800K?
    2011 inventory must be higher than in 2008-2010 for houses less than a mil

  101. Libtard at home says:

    I can’t definitely say we hit bottom, but it sure seems like the implosion of society as we know it has slowed to a crawl. Sure my company downsized again (what’s new), and a gentleman up the block from me just got the pink slip, but people are still getting married, are having kids and they need a place to live. Some people (banksters and support industries) are getting decent bonuses. Car sales are up (albeit nothing to write home about), home sales have leveled and affordability continues to improve. Three of Gator Jr.’s classmates have moved out of town and it’s only December. The fact that the homebuilders are starting to do their thing again and even the equities markets are improving (gold dropping) all point to a better tomorrow. I sh1t you not, I can’t believe how much rent my multi was able to garner. I never dreamed it could do this well. A lot of things are SLOWLY getting better for some. People are adjusting their spending habits. The moment one of those vacant stores gets rented at that empty mini-mall in Union I like to post about, I’m reducing my bond allocation from it’s current 30% to zero. Just look at Verizon stock. I went to Target last weekend in Clifton to pick up some groceries and I had to park at the Shannon Rose. There were mounted police on horseback to control the madness. Don’t get me wrong! Things are still quite bleak, but they appear to have leveled off from my perch.

    Perhaps it’s the flight to safety that the Euro collapse is causing, but things are definitely not as doomsday as before.

  102. grim (25)-

    My theory is based on the known fact of the system’s being jammed with so much dead/fraudulent/zombie/non-performing paper.

    Until the bad, unpayable debt is written down and written off, the market will fail to restart.

  103. grim says:

    Westfield November Actives – Count/Average List Price/Inflation Adjusted List Price

    2001 – 121 – $565,007 – $721,747
    2002 – 132 – $653,871 – $882,263
    2003 – 142 – $692,306 – $851,198
    2004 – 123 – $881,605 – $1,055,826
    2005 – 200 – $991,928 – $1,149,021
    2006 – 251 – $961,926 – $1,079,447
    2007 – 235 – $1,021,169 – $1,114,193
    2008 – 218 – $879,875 – $924,530
    2009 – 166 – $950,944 – $1,002,773
    2010 – 201 – $720,575 – $747,586
    2011 – 171 – $744,866 – $744,866

  104. grim says:

    2011 inventory must be higher than in 2008-2010 for houses less than a mil

    I don’t follow, are you saying this is a sign of a weak or weakening market? I look at the trend in average list as awesome news for buyers. Average list price of actives down 25% nominal (30% real) for Westfield. I’m sorry, you are saying this isn’t great news for everyone who waited out the bubble?

  105. Comrade Nom Deplume says:

    (93) fabius,

    Strict necessity is not a requirement for deductibility. It is not necessary to clean offices or provide benefits, but if it is useful to the business, you can generally deduct it. The job must be legitimate (market pay for actual work), but if it is, I contend it is deductible.

    But if you have some authority to the contrary, I would like to know.

  106. Shylock (aka, Anon E. Moose) says:

    Grim [105];

    Ten years under the bridge, like nothing ever happened, huh? A fair deal is too good for them. I want my pound of flesh.

  107. Any pause in the plummet into oblivion is only temporary, at best.

    The wheels are coming off, albeit slowly.

    When the final cataclysm comes, it will make Argentina in the early ’90s look like a boom.

    Yield must be paid…and the vigilantes will not “skip” the US. Instead, they may make us their final course.

    All fiat will collapse. All sovereigns will default. Only distinctions will be between the ones who go down fighting and the ones who go with a whimper.

  108. A nice piece, just posted at ZH today. I would agree with most of this:

    “You rightly expect me to provide you with investment opportunities – whether bull market, bear market, or total societal collapse. And that’s what I’ve done every month for more than 15 years.

    But that’s not what I’ve done this month. You won’t find any investment ideas at all in these pages. This issue is unlike any other I have ever written.

    I’m sure it will spark a wave of cancellations – costing me hundreds of thousands of dollars. I fear it will spark a tremendous amount of controversy. Many people will surely accuse me of deliberately writing inflammatory things in order to stir the pot and gain attention. That’s not my intention. The truth is, I’ve gone to great lengths throughout my career to protect my privacy.

    I am speaking out now because I believe someone must. And I have the resources to do it. I am sharing these ideas with my subscribers because I know we have arrived at the moment of a long-brewing crisis.”

    http://www.zerohedge.com/news/guest-post-corruption-america

  109. PGtips says:

    106 grim

    I am only interested in 1998 and about pricing. I know that present incomes will clear this price despite taxes and will minimize my loss. Buying 25% or more than this price translates to losing my downpayment within a few years. How this is good news for a buyer?

  110. grim says:

    Westfield November Sales – Count/Average SP/DOM/Adjusted SP

    2001 – 25 – $432,612 – 38dom – $552,625
    2002 – 28 – $573,715 – 69dom – $721,464
    2003 – 32 – $528,681 – 66dom – $650,019
    2004 – 31 – $714,113 – 58dom – $885,234
    2005 – 27 – $661,626 – 38dom – $766,409
    2006 – 24 – $787,142 – 94dom – $883,309
    2007 – 21 – $633,519 – 56dom – $691,230
    2008 – 14 – $808,189 – 131dom – $849,206
    2009 – 32 – $694,619 – 81dom – $732,478
    2010 – 21 – $576,702 – 79dom – $598,320
    2011 – 17 – $603,176 – 74dom -$603,176

  111. grim says:

    111 – Oh yea? 1998 pricing? In Westfield? Let me guess, nominal too right?

    Let me know when you find that genie, cuz I’d like a harem of supermodels.

  112. Comrade Nom Deplume says:

    (75) west

    Makes me wonder what Rawls thought of Harrison Bergeron.

    In related news, the Handicapper General is supposedly leading in Mass. Senate race.

  113. NjescaPee says:

    We’re at 2001 pricing here. RE tax is at mid nineties level. Go figure

  114. PGtips says:

    113 grim

    you make it sound like it is a fantasy. You forget that a couple of years ago dow was 6000 and most of banks were ready to default. Was that a fantasy too? In fact my vision is pretty realistic grounded on a previous clearing price level. I hope not but worse things can happen if central banks cannot contain deflation etc.

  115. grim says:

    I forget?

    There are collectively thousands of stored comments that narrated the collapse in real time here. All day, every day, without pause. Database says that we’ve got 422,000+ comments stored since I started in 2005.

    So, how much money did you make on the claw back from the precipice of Armageddon?

    Tens of thousands? Hundreds of thousands? Lucky enough to cash in the big ticket, eh?

    Or was it nothing, because you were so sure it was the end of days?

    So what are you in now? Where do you sit? Cash? Metals? Equities?

    Lay it out for me.

  116. Neanderthal Economist says:

    94-97, grim not off rocker at all, that is all totally true.

  117. BearsFan says:

    Nicholas – sorry, but I have rebut a little. Suggesting immigration will offset the boomer retirement wave is a bit hopeful. The wave is just starting to form and won’t peak for 15 to 20 years, ending with an estimated 1 in 5 being over 65 at the peak. That’s a lot of people looking to downsize, and who will also be unproductive and in need of benefits. Doesn’t help the macro story one bit.

    ID’ing rates at an all time low and literally stuck there for the foreseeable future, and marrying that with it not being catalyst for buyers to act, does suggest a change in perception…I agree. People are realizing that there is no need to rush. The mystique has wore off. Why would this suggest a bottom? Normalcy Bias?

    I should have clarified, but any comments I make on RE will always be inre: to NJ, specifically Middlesex and Monmouth county. I realize a lot of you hunt further north than this, and the market dynamics due to geographics are definitely different. That being said, in NJ, if you want to believe that local taxes are in check and will not rise in the coming years, go ahead. The math suggests otherwise.

    and ignoring the level and impact of stagflation right now, frankly, is silly. You can call it conjecture, that’s fine. I’ll say that the Fed’s hands are tied and they are predictable at this moment. They cannot let rates rise period, and they will ultimately have to continue to monetize the debt. Treasury was mentioned, but not sure why. They do not control monetary policy, they simply collect and redistribute money, and issue IOUs.
    The relevance to RE may be conjecture, sure, and that is that people know…they may not know why or how, but they know their necessity costs are rising 10% a year and their wages are flat. This is causing caution, exploitation of credit amongst seniors especially…as gary likes to say…tick, tick, tick.

    meat is dead on. just cuz some of affluent on this blog may have a buddy or two who are doing OK on the street…I’ll stick to watching sales volume, the overall macro story, and borrowing/tax costs to gauge direction, as many on this blog have stated for awhile.

    grim, your comments on inventory being less than stellar are accurate from what i’ve seen as well…and the only pulse I have seen in monmouth (where I am looking) is homes that are in great shape. Most are closing around 5-10% below ask. The rest (mainly boomer owned) sit and wait for some miracle.

  118. BearsFan says:

    def suggest checking out zerohedge article meat posted at 110 too. good stuff.

  119. AG says:

    “All fiat will collapse. All sovereigns will default. Only distinctions will be between the ones who go down fighting and the ones who go with a whimper.”

    If America doesn’t elect Ron Paul the aforementioned will be a cake walk to where we are headed.

    Stay mobile. You may need to get the h_ll out of here.

  120. sas says:

    “Borrowers or Banks?”

    it was the god damn fall of the berlin wall, and capital began to flow like mad & consolidation kicked into high gear.

    SAS

  121. Whoa. sas only shows up here when things are about to go batshit crazy.

    Merry Xmas, dude. Hope you weren’t stuck in Lodi.

  122. Confused in NJ says:

    Now that we are out of IRAQ, maybe the Army will be selling used armored Humvees? Might be a good buy for what’s coming!

  123. I asked Santa to bring me an Exocet missile.

  124. Juice Box says:

    I am in Vail for the holidays if it were not for the rich central americians (mexican) and
    The south Americans this place would be a ghost town.

  125. fantastic with an incredibly facinating submit to examine from this excellent internet site! Don’t ever compose just about any enter only now merely can’t fight ..|

  126. Mikeinwaiting says:

    Ag 121 they would wack him first. I have no where to go I live where people get the h*ll out to! That is unless your leaving the country.
    Meat 125 I waaant one too! Just put in place a 6 year old voice on that one.
    Juice 126 Enjoy , you lucky dog!

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