No equity, no sellers, no sales

From the Star Ledger:

Lack of equity slows home sales in New Jersey

Although the number of homes in foreclosure or struggling to make mortgage payments in New Jersey has been slowly dropping, it hasn’t been translated into a rise in home sales.

Sales of existing homes rose in April, according to data released yesterday by the National Association of Realtors. Nationwide, resale activity was 9.7 percent above April 2012, but only 4.9 percent in the Northeast region, which includes New Jersey.

Distressed homes — properties that sold in foreclosure or for less than the mortgage was worth — accounted for 18 percent of April sales, according to NAR, down 28 percent from last year. Eleven percent of April sales were foreclosures, and 7 percent were short sales.

A study being released by the real estate company Zillow this morning, however, notes that nearly 40 percent of northern and central New Jersey homeowners can’t put their houses on the market because of insufficient equity.

About 17.5 percent of homes in the 12 counties that make up the central and northern parts of the state tracked by Zillow are at least 90 days behind on mortgage payments, Zillow found. But an additional 21.4 percent don’t have enough equity in the home to afford a down payment and closing costs on a new house, tying them to their property and limiting the number of homes on the market.

Zillow Chief Economist Stan Humphries said without enough equity, those costs come out of a homeowner’s pocket, “leaving many still stuck. Looking at the effective negative equity rate could explain why recent, healthy declines in the number of underwater borrowers haven’t yet translated into more homes for sale.”

The percentage of homes with insufficient equity to move ranged from 47 percent in Hunterdon and Hudson counties to 31 percent in Morris County.

Humphries said “the only cure is patience, as rising home values continue to build equity to the point where more homeowners can realistically sell.”

This entry was posted in Economics, Housing Recovery, Mortgages, New Jersey Real Estate. Bookmark the permalink.

94 Responses to No equity, no sellers, no sales

  1. grim says:

    IMHO – Zillow’s “effective negative equity” methodology is interesting, but ultimately flawed as it assumes the seller needs to have 20% equity to sell, so it disregards any sale that’s closer to break even, disregards short sales, disregards relocation sales, disregards checks at closing, etc. It also errantly includes many recent purchasers, who don’t have 20% equity, but wouldn’t necessarily even be a candidate seller since they just recently purchased…

  2. grim says:

    From Forbes:

    Case And Shiller Say Housing Is Better, Not Back To Booming

    Chip Case and Robert Shiller are known for the gauge of home prices that bears their name, but as that indicator continues to draw cheers for a U.S. housing recovery the pair warn that things are not quite as rosy as they appear.

    The latest S&P/Case-Shiller reading showed that the 20-city average of prices was up 9.3% in February from the prior year, driving talk that the housing market is ready to be a driving force for the American economy once again.

    Not necessarily so, warns Shiller, who says that while housing is normalizing, the uptrend in prices is not particularly big on a historical basis and underlying indicators of economic health are not overwhelming.

    “There’s a lot of breathless commentary in the media right now,” Shiller told a small group of reporters at a breakfast Wednesday morning, and he just isn’t convinced that anything beyond a modest recovery is in the offing, even though he thinks there is sufficient momentum for the gains in prices to continue for the next 6-12 months.

    Case admitted to being a bit more bullish at the event Wednesday, but was troubled by last week’s figures on new home construction, with housing starts slipping to an annualized rate of 853,000 in April. He called it a “terrible number,” after the prior month’s climb above 1 million starts.

    David Blitzer, chairman of the S&P Dow Jones Indices index committee, proved to be something of a tiebreaker. He’s “mildly optimistic” that prices could rise another 5-10% over the next year. Housing is going back to some kind of normality, but normal isn’t rising 20% a year, he adds.

  3. grim says:

    From Bloomberg:

    Home Supply Limited as 22 Million Americans Lack Equity to Sell

    About 22 million Americans may lack enough home equity to move, keeping property listings tight and limiting sales as the housing market recovers, Zillow Inc. (Z) said.

    Forty-four percent of homeowners with mortgages owed more than their properties are worth or had less than 20 percent equity in the first quarter, the Seattle-based real estate data company said in a report today. Those people probably are locked in to their residences, because listing a house and purchasing a new one generally requires equity of at least 20 percent to meet costs such as a down payment and broker fees, Zillow said.

    The people who cannot sell are contributing to a dearth of home inventory on the market, which is restraining deals in the key U.S. spring selling season. There were 2.16 million homes available last month, the fewest for any April since 2001, the National Association of Realtors reported yesterday. While the low supply is helping to fuel price gains and lift home equity, values have to climb further to ease the shortage, Zillow said.

    “Looking at the effective negative-equity rate could explain why recent, healthy declines in the number of underwater borrowers haven’t yet translated into more homes for sale,” Zillow Chief Economist Stan Humphries said in the report. “Things like real estate agents’ fees and a down payment for the next home traditionally come out of the proceeds from the prior home’s sale. Without enough equity, these costs will instead have to come out of a homeowner’s pocket, leaving many still stuck.”

    More than 13 million homeowners were underwater in the first quarter, equal to about 25.4 percent of those with a mortgage, down from 13.8 million at the end of 2012, Zillow said. Another 9 million people had less than 20 percent equity.

  4. grim says:

    From the WSJ:

    Four Reasons Why Home Sales Are Looking Healthy

    1. Sales have increased from their year-earlier levels even though there are significantly fewer homes for sale. The 2.16 million homes for sale in April was 13.6% below last year’s level. So far, significant price gains over the past year haven’t slowed sales, partly because low interest rates have allowed buyers to swallow higher prices without seeing much gain, if any, in their monthly payment.

    2. Sales of non-distressed homes are picking up. Around 18% of sales in April were a foreclosure or a short sale, down from 28% one year ago. Big drops in the availability of foreclosures and other short sales haven’t yet produced declines in reported sales volumes, which means home buyers are increasing their purchases of non-distressed homes.

    In California, home sales fell by 4% in April from one year earlier, according to real-estate data firm PropertyRadar, but this headline masks big changes. Distressed-property sales fell by 39.4% from a year earlier, while sales of non-distressed homes rose by 36.6%. When or whether the non-distressed component can offset the decline in the distressed component will be an important milestone in a housing recovery.

    3. The number of homes for sale jumped by 11.9% in April from March. Much of this is seasonal—more people tend to list their homes for sale in April. After taking into account these seasonal factors, inventories were up by 1.8%, according to Jed Kolko, chief economist at Trulia. While inventories are up 22% so far this year, they’re up by 4% after seasonal adjustments, according to Mr. Kolko.

    Many real-estate agents have said that sales volume has been limited by the lack of supply. By the same token, the fact that demand has outstripped supply also goes a long way to explain why prices are rising by around 10% from their year-earlier levels. Rising inventory should ultimately slow some of the price rally while boosting sales volumes, helping to restore equilibrium in the housing market.

    4. Homes are selling faster. Half of all homes that sold in April were on the market for 46 days, down from 62 days in March and 83 days one year ago, according to the National Association of Realtors. A separate analysis of 22 markets by Redfin, the tech-powered real estate brokerage, showed that 20% of homes went under contract in just one week in April, and one third of all homes were under contract in two weeks. The share of homes that went under contract in two weeks increased by 39% from one year ago.

  5. grim says:

    Wow Nikkei drops 7.3% overnight, someone call the Caymans and wake up the PPT.

  6. Fast Eddie says:

    Grim,

    Lotsa interesting stuff posted this morning. It goes along with my dilemma of attemtping to find something worthy of buying. Whether it’s zero equity or close to 20% equity, a lot of people don’t have the muscle to make a move; thus, they’re staying where they are and either struggling to get by or ultimately losing grip and giving up.

  7. Fast Eddie says:

    This statement is the smoking gun:

    About 17.5 percent of homes in the 12 counties that make up the central and northern parts of the state tracked by Zillow are at least 90 days behind on mortgage payments, Zillow found. But an additional 21.4 percent don’t have enough equity in the home to afford a down payment and closing costs on a new house, tying them to their property and limiting the number of homes on the market.

  8. grim says:

    8 – My argument is the same as last time.

    You simply can’t use averages or medians when you are talking about North Jersey, they are more misleading than helpful.

    Why?

    Negative Equity is 5% in Wyckoff, Short Hills, 5%, Chatham 6%, Summit 6%

    Negative Equity is >50% in Paterson, >50% in East Orange, >60% in Newark, 70% in certain zip codes in Elizabeth

    Both are North Jersey, and we’re talking about a difference of 10x between the best and worst performers.

    There are towns that are around the 17.5% mark, but most mid-tier towns in NJ are lower than 15%, and most high-tier towns in NJ are lower than 10%.

    Delinquency and Late Payments data follows almost exactly the same pattern as Negative Equity.

  9. Fast Eddie says:

    Grim,

    Whether your equity is minus 15% or plus 10%, a lot of people don’t have the muscle to make a move. I understand the descrepencies between towns like Paterson and Wyckoff and what those averages mean. Whether they’re bankrupt or swimming furiously to keep their nose above water, the pipeline is clogged. The last statement in the article about patience is true, but to borrow a phrase from BC Bob, “It’s gonna be a long walk home.”

  10. JSMC says:

    BTW, thanks to everyone for their input yesterday. Not sure if he/she’s still around around, but..

    #107 (last thread)

    What did happen with Rockaway concerning congestion? Was it contained in certain areas? Oddly enough that concerns me far more than Picattiny blowing the town to bits. Also, property taxes there seem about on par with the rest of NJ now, maybe about a 1k more, so I’m curious about that as well (just want to make sure they don’t hit haughty Bergen Co. levels)

  11. grim says:

    From CNBC:

    Economy Is on the Move Again—and So Are Americans

    Americans are on the move again.

    Thanks to the slowly brightening employment picture, along with the uptick in the housing market, more and more people are packing up and relocating. And the pace is likely to pick up this summer, the peak season for moving, according to industry professionals.

    It’s a far cry from just a few years ago.

    “Two years ago, it seemed like everything was falling off the face of the Earth,” said Randy Shacka, president of Two Men and a Truck, a franchise moving company. But monthly payroll growth averaging 208,000 is turning that around—and spurring job-related moves.

    Even though overall moving activity is still below where it was in 2009-10, the number of people moving for a new job or transfer is on the rise. Moves for those reasons totaled 3.5 million in 2011-12, up from 2.8 million the prior year and the highest since 2006-07, according to Census Bureau data. And the number of people moving because they had lost a job or were looking for work declined.

  12. grim says:

    Morris County is no longer the property tax haven it used to be.

    Politicians took a look at other towns and counties and realized they were missing out on the opportunity to collect additional revenue. So, they spent.

    Ironically, certain parts of Bergen might have the advantage these days. I’d say in the NNJ area, Essex is by far the worst (less Cedar Grove and Fairfield).

  13. JSMC says:

    Also, I never mentioned this yesterday (but JJ in last thread reminded me), but neither me or my wife work in NYC: we both work in Southern Bergen county. That’s why proximity to 80 is so important.

  14. JJ says:

    Over the past half century, U.S. inflation was approximately 4%. What you could buy for $100 50 years ago would cost about $700 now. Many people retire with at least 25 years left to go. At this 4% rate, that means they will someday have to pay $350 for the things that cost $100 at retirement.

  15. Libtard at home says:

    Essex is by far the worst (less Cedar Grove and Fairfield).

    Don’t I know it (times 2)

    Time to fix some screens at my multi.

  16. anon (the good one) says:

    In relation to the recent events in the UK,
    this is from the Guardian, May 2.

    “A 75-year-old man stabbed to death yards from his home may have been targeted in a racially motivated attack, according to police.

    Mohammed Saleem, who used a walking stick, was stabbed three times in the back as he returned home from prayers at his local mosque in Small Heath, Birmingham, on Monday night.

    The blows were struck with such violence they penetrated to the front of his body.

    The father of seven also had no defensive wounds in what has been described as a swift, vicious and cowardly attack by the man leading the murder investigation, Detective Superintendent Mark Payne of West Midlands police.

    Officers want to trace a white man, aged 25-32, of medium height and build, spotted on CCTV footage running near the scene of the attack around the time it happened, just before 10.30pm.

    Police also want to trace a seven-seat people carrier captured on CCTV, driving near the mosque with the two male occupants, both white and in their 30s, who are considered “significant witnesses”.”

  17. grim says:

    From MarketWatch:

    U.S. jobless claims drop 23,000 to 340,000

    The number of people who applied for new unemployment benefits fell by 23,000 to 340,000 in the week ended May 18, the U.S. government said Thursday, keeping the level of initial claims in a range consistent with modest job growth. Economists surveyed by MarketWatch expected claims to drop to a seasonally adjusted 343,000. The average of new claims over the past month, a more reliable gauge than the volatile weekly number, edged down by 500 to 339,500, the Labor Department said Thursday. That’s just above a five-year low.

  18. Comrade Nom Deplume, Halfwit dumbass says:

    Continuing claims down again. While good, it occurred to me to ask whether this is job growth or attributable to long term unemployed exhausting benefits. And among the newly employed, is that high quality growth or is that number made up of low quality and part time jobs? I suppose household formation would inform that, wouldn’t it?

    Discuss.

  19. Comrade Nom Deplume, Halfwit dumbass says:

    [19] redux,

    I see grim posted on the new claims number, down as well. That answers the question in part.

  20. 1987 Condo Buyer says:

    Essex was so bad in the 1980’s that was my primary tax concern about staying in the county, but since 1993, the annual tax rate increase for Essex has been a bit over 1% while the surrounding counties, Passaic and Morris, did exactly what Grim said and brought themselves more in line.

  21. grim says:

    From Reuters:

    Jobless claims drop more than expected last week

    The number of Americans filing new claims for unemployment benefits fell more than expected last week, pointing to resilience in the labor market despite belt-tightening by Washington.

    Initial claims for state unemployment benefits dropped 23,000 to a seasonally adjusted 340,000, the Labor Department said on Thursday, pushing back below the 350,000 mark that economists normally associate with a firming job market.

    Claims for the prior week were revised to show 3,000 more applications received than previously reported.

    Economists polled by Reuters had expected first-time applications to fall to 345,000 last week.

  22. JJ says:

    Manhattan has a magnetic draw. My wife who has always lived on Long Island has always tried to work on Long Island when she was working. But she could not afford to live on a Long Island salary. The three jobs she had on Long Island all three relocated her back to NYC. Even firms like KPMG, PwC, DT, EY, Computer Associates, Unisys the high paying jobs require you to go to NYC a lot. Selling consulting work in the surburbs is hard, the companies are small and even a little tiny 50K gig seems like real money to them. When I last did consulting. I had to sell one million a year in new business and stay chargeable at 75%. And that was based on a 52 week year working five days a week. 100% assumed no vacations, no holidays. So pretty much every work day you need an account to hit. My bill rate was $375 an hour. I could sell anywhere. And in 8 years of consulting I did not book one single hour in Long Island. I booked like a five months in eight years in NJ. But NJ was only when times were tight and the pay rate was low.

    I think the trouble is 90% of high paying jobs are in Manhattan, 2-3% of high paying jobs are in Jersey City just outside of Manhattan. The remaining 5% of high paying jobs are in office parks in NJ, Office parks by route 110 in Long Island and Stanford.

    One has to expect when the wife has the second kid it is 50/50 she goes back to work, by third kid is like 90% she does not go back to work.

    A man with three kids, a stay at home wife, two cars and a house needs a job that pays at least 250K a year just to survive. Counting on finding a job when one buys a house at 32 that pays that much in the surburbs for the next 35 years to retirement at 67 is tough. And remember inflation is 4% historically so you need to not only make 250K but get a job that gives you that much of a raise every year for 35 years.

    Once you max out 401k, max out flex spending, max out 529, pay mortgage and cars and try to save for rainy days it is shocking how on a 250K job you are on line with the bums returning tin cans and trying to sneak articles on line as you cant afford a subscription to the NY Times.

    JSMC says:
    May 23, 2013 at 8:21 am

    Also, I never mentioned this yesterday (but JJ in last thread reminded me), but neither me or my wife work in NYC: we both work in Southern Bergen county. That’s why proximity to 80 is so important.

  23. Juice Box says:

    House day is here. I am going to play a joke on my wife and take her to the house she did not want and pretend it is the house we bought.

  24. grim says:

    Old piece from Krug in the NYT – But provides basis for the magic 350k/400k numbers:

    http://krugman.blogs.nytimes.com/2010/12/31/unemployment-claims-and-employment-growth/

    We are in the sweet spot

  25. JJ says:

    Long Island for instance had a dramatic drop in Unemployment. But a few articles I read about that bucketed people into four categories.

    1) Women with young kids, folks on disability, folks over 60 who retired early simply dropped out of work force
    2) Blue Collar men without a college degree who had high unemployment are all working on Sandy related stuff. Huge demand for anyone who can swing a hammer. These folks were out of work a lot since housing bubble burst
    3) FEMA/NYS/Charities all got massive funding and hired tons of clerks and housewifes for 1-2 year gigs related to Sandy
    4) Service industry is way up since recession ended, Hamptons, Restaurants, Store Clerks all hiring. The HS, College kids and young minorities who were all unemployed are busing tables, mixing drinks and folding pants at the gap again

    Problem is the middle of career “married man” profession jobs have been non-existent or very week. These are the most desirable and higher paying jobs.

    If I was unemployed and had no unemployment I could most likely just become a contractor for a year or two, but then what, if I get hurt I am screwed, at my age I can’ t do that sort of work more than 1-2 years and my wife can quickly get a part time job at FEMA or something for 1-2 years, maybe kids could get a job at beach club setting up chairs. Sure employment would triple in my house, but I would be making 1/3 my salary now. So Household income is falling while unemployment is falling the ultimate oxymoron.

    Comrade Nom Deplume, Halfwit dumbass says:
    May 23, 2013 at 8:40 am

    Continuing claims down again. While good, it occurred to me to ask whether this is job growth or attributable to long term unemployed exhausting benefits. And among the newly employed, is that high quality growth or is that number made up of low quality and part time jobs? I suppose household formation would inform that, wouldn’t it?

    Discuss.

  26. JJ says:

    Just make sure at your other house your mistress is not home.

    Juice Box says:
    May 23, 2013 at 8:55 am

    House day is here. I am going to play a joke on my wife and take her to the house she did not want and pretend it is the house we bought.

  27. grim says:

    The middle manager doesn’t exist anymore.

    Aren’t most large lean organizations something like 6 levels from CEO to PEON (or less)?

    This trend has nothing to do with the current recession, and everything to do with technology allowing organizations to flatten. The recession may have accelerated this, but it wasn’t the cause. This trend was firmly in place a long, long time ago.

  28. JJ says:

    March home prices up 1.3%

  29. grim says:

    Circa 1968 – Chicago Graduate School of Business:

    http://www.chicagobooth.edu/~/media/9CE1861C6681473E8639D0DD931FBAB5.PDF

  30. JJ says:

    Middle Managers are drain on the bonus pool. Most companies kept department heads but got ride of a lot of the middle management folks, the VP, Senior Manager level.

    I find best set up for most companies is One head of a Department who handles all the mundane presentations, staffing, budgeting, dealing with C level people etc. One trusty right hand man free from this nonsense who gets the troops to do their daily work. But the troops today have become housewives, younger workers, folks near end of career. The 32-52 year old Male Head of Household with an MBA and stay at home wife who wants a big salary and bonus either had to grab the only two good jobs in Department, Head of or second in command. I see departments that now have 40 people with only two highly paid positions. In 2006 same department would have included 5-10 highly paid middle managers. Like Secretaries and Token Booth Clerks those jobs are gone and will never come back. In fact folks like me discovered the best works are kids 2-3 years out of school. And then keeping them for 3-5 years and rotating them out. It keeps me sane. I dont like watching folks get old. Bad enough I have to watch myself age.

    I recall one staff member years ago she stayed 8 years. We got her at 24, by the time she left at 32, its was like my feet, the buss, my kid is sick, the mortgage, OMG who cares. Give me a hard working single 24 year old girl. I rather teach her and put up with her mistakes.

    there is an old saying what is cute at 21 is sad and pathetic at 41.

    grim says:
    May 23, 2013 at 9:01 am

    The middle manager doesn’t exist anymore.

    Aren’t most large lean organizations something like 6 levels from CEO to PEON (or less)?

  31. grim says:

    From MarketWatch:

    FHFA: March home prices up 1.3%

    U.S. home prices rose a seasonally adjusted 1.3% in March, and prices grew 6.7% in the first quarter from the same period of 2012, the Federal Housing Finance Agency said Thursday. Compared to the fourth quarter, prices rose 1.9%, the seventh straight quarterly rise. “The housing market has stabilized in many areas and homebuilding activity has strengthened in recent quarters,” said FHFA Principal Economist Andrew Leventis. “That said, labor market weakness and still-elevated foreclosure pipelines remain hindrances to a more robust recovery.”

  32. DL says:

    Underwater friend in Fla just refinanced this year (bought in 2006; ouch!) to lower his monthly payment and plans on staying put. Had another friend in DC who did 100% financing with interest only ARM and sold 3 years later, just before the crash. She had no equity but was still able to sell.

  33. JJ says:

    It is only a big hit if one bought their first home or big trade up home in home in 2006.

    If one for instance sold their widely over priced two bedroom condo to buy a three bedroom house in 2006 the damage was limted.

    DL says:
    May 23, 2013 at 9:22 am

    Underwater friend in Fla just refinanced this year (bought in 2006; ouch!) to lower his monthly payment and plans on staying put. Had another friend in DC who did 100% financing with interest only ARM and sold 3 years later, just before the crash. She had no equity but was still able to sell.

  34. grim says:

    to lower his monthly payment and plans on staying put

    On staying put, since this ties into the headline piece:

    In the 80s the average length of homeownership was around 12-13 years or so, by the 90s, that dropped to 10 years, and at the height of the bubble, that dropped to an amazing 6 years, we’re currently back up somewhere around 9 years.

    The challenge here is that as the homeownership length drops, the ability to build equity drops as well … in addition to accruing significant transaction costs along the way.

    The 6 we saw during the bubble was insanity, and was the reason for the high amount of sales and inventory on the market.

    Being forced to stay put a little while isn’t necessarily a bad thing…

    IMHO – If your horizon is under 10 years, you probably shouldn’t be buying a home.

  35. grim says:

    On a 400k loan, 30 year, 4% interest.

    In the first 5 years, the owner will build a whopping $40k in equity through principal paydown, despite paying $115k in mortgage payments.

    Staying in a house for 5 years is a sucker deal.

  36. grim says:

    One more point on housing inventory in the local markets and how turnover impacts it:

    Two major factors:
    Turnover Rate
    Total Inventory
    (duh)

    I will say, that the more desirable towns tend to be smaller than the less desirable towns, so your starting inventory levels are much lower. Secondly, (anecdotally), turnover tends to be lower in the more desirable towns, restricting inventory even further.

    Glen Ridge is a great example of this. Small town, low turnover, abysmal inventory as a result.

    Families move in when their kids first kids enter grade school, and leave when their youngest kids start college. I can try to pull the numbers or find them, but I’ll guarantee that you see a big portion of the community staying at least 17-25 years.

  37. anon (the good one) says:

    that’s rite. at my place they only keep revenue generators. no mid level fat. we hire lots of young people. funny to see their transformation. they are pretty much useless for the first few yrs. lots and lots of qualified ppl out there, but you can’t hire them all. aniwho, after a while the young guns think of themselves fat cats and turn republican. they are clueless to realize that LUCK is what got them a job. once they get kicked out, turn into angry crazy eddie.

    grim says:
    May 23, 2013 at 9:01 am
    The middle manager doesn’t exist anymore.

    Aren’t most large lean organizations something like 6 levels from CEO to PEON (or less)?

    This trend has nothing to do with the current recession, and everything to do with technology allowing organizations to flatten. The recession may have accelerated this, but it wasn’t the cause. This trend was firmly in place a long, long time ago.

  38. Juice Box says:

    Grim my Horizon is until June of 2031. I gather we will
    see a few ups and downs in home prices. I will stay put
    Unless we are crazy enough one day to want to trade up to the 7 figure home.

  39. Libtard at home says:

    Banner day for Mad Loot Investment Club

    Rue21 going private (up 23%)
    Dollar Tree which is our second largest holding had beautious earnings (up 4%).
    Heico, our little unknown defense contractor that makes parachutes and old plain parts reported awesome earnings (up 6.5%)

    Now if Apple would just release a new blockbuster…huzzah.

  40. Anon E. Moose says:

    Grim [28];

    I don’t buy it. It has to be a function of organizational size. There’s no way a Sr VP can effectively manage 600 direct reports in the name of “Lean 6-sigma”. Excessive depth is its own problem, but its not solved by hacking out intermediate levels.

  41. Fast Eddie says:

    aniwho, after a while the young guns think of themselves fat cats and turn republican. they are clueless to realize that LUCK is what got them a job.

    You’re right. It doesn’t take luck to cash a welfare check while holding a Bomma phone.

  42. Libtard at home says:

    Six Sigma my hairy @ss. Look how well it helped GE and Welch.

    https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximized&chdeh=0&chfdeh=0&chdet=1369339200000&chddm=1783742&chls=IntervalBasedLine&q=NYSE:GE&ntsp=0&ei=TyyeUcjeLPDq0QHTJw

    TQM/Six Sigma/Lean

    It’s really much more simple. Create baseline/Make change/Measure change versus baseline/follow through. Everyone blows follow through since they fired all the people who had the time to maintain and continually analyze records.

    There. I just saved you about 10 hours of training.

  43. Libtard at home says:

    Speaking of Middle Managers. I am now four of them. My business card can not fit all of my titles.

  44. JJ says:

    They turn useless in a slow progression from the day they get or put on the engagement ring to the day they have their first kid.

    Back in my day, I would work with someone for a few years and finally get to go out to dinner or corporate retreat and find out they have four kids and a long commute.

    Nowdays facebook twitter crowd drag you into their world.

  45. joyce says:

    (38)
    Sure it was luck? No nepotism involved?

  46. Painhrtz - Disobey! says:

    Lib when my wife got her six sig black belt for PM. I summarized a week of training as this find inefficiencies, look for areas of improvement, measure outcomes, rinse repeat. Now give me 1500 dollars.

  47. Statler Waldorf says:

    Another bidding war sale just closed yesterday. The bottom in desirable towns was 2-3 years ago.

  48. Statler Waldorf says:

    JJ, isn’t the median income in your town about $60K?

    “A man with three kids, a stay at home wife, two cars and a house needs a job that pays at least 250K a year just to survive.”

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  50. JJ says:

    I would say it is 300K.

    On the books a lot less. Several neighbors owns stuff like a body shop, gas station, contractors, plumbers report almost no income.
    Yet I see Caddies, GMC trucks, Mercedes, pools, trips to Beaches, cruises, you go to their houses you see antique juke boxes. Also surprising how many of neighbors have vacation homes, collector cars.

    These guys crack me up. After Sandy my wife said she felt like a drug dealer. We did 40K worth of work to house and everyone was getting cash. We made several trips to bank at 5K to 8K each. Contractors never ask for more than 9K cash at a time as they know banks would ask

    The retired cops and the firemen lots of NYS pension money is exempt for taxes and their free medical is a tax free perk. If you have a useful trade such as making decks, sheetrocking, electrical, putting in a kitchen or a bath etc. The contractor buddies really help out.

    For instance my home inspector asked me to bring $450 cash in an envelope. Plumber who fixed pipe said he would give me the “fishing money” Saturday price with no receipt cash in pocket so wife dont know. We have bartenders, people working weddings, people who sell at flea market, folks who fix up cars.

    The civil service people dont want nothing on the books. Sandy charties are having a field day by me as everyone qualifies based on their 2012 income return.

    Jersey does not have this cash mentality. Originally some insurance companies, fema wanted W-9, TINs, contractor licenses, permits etc. Till they realized we are in the wild wild west. .

    Statler Waldorf says:
    May 23, 2013 at 11:38 am

    JJ, isn’t the median income in your town about $60K?

    “A man with three kids, a stay at home wife, two cars and a house needs a job that pays at least 250K a year just to survive.”

  51. maybe buyer says:

    grim 37

    hmmm
    madison which is less than half than montclair in units (3.4K to 7.3K) ) has more than half available inventory (61 to 115). Also millburn which is smaller than montclair has the same inventory (gsmls search).

    Other factors are at play as well.

  52. Should be great fun when the Fed begins weaning the junkie from a steady supply of smack.

  53. Then again, maybe Yellen gets installed as chief dealer and she decides on more her0in for everyone.

    Good times.

  54. Damn. I can’t get this gun to print.

  55. Libtard at home says:

    NJ takes cash as well. Though admittedly, most don’t know. Makes the discount bigger for those who do. Gotta report something.

  56. NJCoast says:

    Our new portable cabanas arrived last week having been built in Amish country. We were allowed to put them on the surviving pilings on the beach but the DEP will only allow them to be there for 180 days a year. A giant crane will lift them onto flat beds to store them inland for the winter. Electric and plumbing hook ups are ongoing and we will not be in until June 14- it’s going to be a short summer at the beach for us.

  57. Juice Box says:

    Chi – I had forgotten how nice downtown Red Bank is, I won’t be missing
    Hoboken at all.

  58. NJCoast says:

    Juicy-
    Let me know when you’re at the Count Basie Theatre, I work most concerts there.

  59. Libtard in Union says:

    I bet you can’t wait to bury your banana in the cabana.

  60. joyce says:

    51
    I would love to meet the people who sell at flea markets and tend bar that pull down $300K

  61. Westjester says:

    Way off topic, but my step-daughter may have to choose between accepting an already offered internship with the US Senate vs pleasing her advisor who promises a titled job and guaranteed entry to the Phd program.
    I find this kind of scary and am unsure of how to counsel her.
    Any thoughts?

  62. Libtard in Union says:

    It’s never to soon to teach her that the government is a sham.

  63. JJ says:

    In HS I briefly worked at the flea market. Guy I worked for brother ran the operation. Everything I quickly figured out was stolen. I only stayed two days. Best was he had a guy who worked on GM assembly line come in with van full of brand new GM hub cap rims and tires. At that time Mercedes cars had hubcaps that were color matched to cars. Very Expensive to buy from Mercedes. And hard to locate as not in inventory. He would buy them ten bucks each and sell them $40 bucks each. Some guy comes up to me and asks if we have four Green Hubcaps to fit his mint 1977 450SLC. Guess what I do and sold it to him $160 cash. Turns out kid just dropped them off while I was there, I sold him his own hubcaps back. Mind you this was when I was 16. He was making several hundred dollars an hour. Bartenders make around $500 a night, they also sell drugs on side. Flea markets and bartenders are very shady folks.

    That guys old brother had some fat stacks of cash. He had vending machine routes, bookie tip numbers, flea markets, garage sales you name it. I got paid $10 bucks and hour that day. $100 cash. I thought he would get busted, but guy is still in business, does rims, bumpers, windshields you name it, he always says you need it I got it, of course he does he stole it.

    joyce says:
    May 23, 2013 at 2:02 pm

    51
    I would love to meet the people who sell at flea markets and tend bar that pull down $300K

  64. Anon E. Moose says:

    JJ [65];

    Bartenders make around $500 a night, they also sell drugs on side

    http://www.freakonomics.com/books/freakonomics/chapter-excerpts/chapter-3/

    No six figures to be had slinging dime bags.

  65. 1987 Condo Buyer says:

    Speaking of bars: Operation Swill

    http://www.northjersey.com/news/NJ_officials_detail_Operation_Swill_probe.html

    One establishment allegedly replaced scotch whiskey with rubbing alcohol and caramel coloring. Another used dirty water and didn’t include any alcohol.

    The establishments – including two in Bergen County and one in Passaic County – are being investigated for allegedly substituting premium alcoholic beverages with cheaper brands, Attorney General Jeffrey S. Chiesa said at a news conference Thursday.

    Investigators seized about 1,000 open bottles of liquor at 29 bars and restaurants across New Jersey raided Wednesday as part of a year-long investigation, law enforcement officials said Thursday.

    “These 29 establishments were allegedly engaging in a scheme to fool customers and increase profits,” he said, adding that a confidential informant with extensive knowledge of the industry provided “valuable information” that aided investigators with the Division of Alcoholic Beverage Control and the Division of Criminal Justice.

    The restaurants have seven days to turn over certain information – including sales and invoice records – and will likely face administrative charges that could cause their liquor licenses to be suspended or revoked, said Alcoholic Beverage Control director Michael Halfacre.

    At one establishment, Halfacre added, investigators found a sign warning bartenders not to throw away premium bottles.

    He declined to give details about what law enforcement officials found at the individual establishments, saying the investigation is ongoing and noting that administrative charges have yet to be filed.

    Individual employees can’t be charged under the state’s liquor laws for substituting drinks, and Halfacre said no criminal charges were being sought as part of the investigation.

  66. grim says:

    67 – I hear 15 of the 29 were TGI Fridays franchises all owned by the same group in Livingston.

    One establishment allegedly replaced scotch whiskey with rubbing alcohol and caramel coloring.

    This isn’t even funny, they could have killed someone. Maybe they already did. No criminal charges? How does that even make sense.

    They should all lose their liquor licenses.

  67. JJ says:

    Hard to do. Like that TV show Weeds, hard to keep the cash flowing.

    Anon E. Moose says:
    May 23, 2013 at 2:41 pm

    JJ [65];

    Bartenders make around $500 a night, they also sell drugs on side

    http://www.freakonomics.com/books/freakonomics/chapter-excerpts/chapter-3/

    No six figures to be had slinging dime bags.

  68. JSMC says:

    #67, 68

    No list of which establishments did this? I’m not sure I’d drink anything that isn’t a bottled beer at a restaurant until we know which 29 restaurants/bars these are.

  69. 1987 Condo Buyer says:

    Here’s the list:

    The establishments targeted were:
    •Applebee’s, Kearny
    •Bell’s Tavern, Lambertville
    •Blackthorn Restaurant, Parsippany
    •The Brick House, Wyckoff
    •Brunswick Grove, East Brunswick
    •Café 34, Matawan
    •Cucina Calandara, Fairfield
    •Graziano’s Ristorante, Chesilhurst
    •Italian Affair, Glassboro
    •Murray’s, Dover
    •Railroad Café, East Rutherford
    •Ruby Tuesday, Bridgewater
    •Sona Thirteen, Morristown
    •Sunset Tavern, Burlington
    •TGI Fridays, Clifton
    •TGI Fridays, East Hanover
    •TGI Fridays, East Windsor
    •TGI Fridays, Freehold
    •TGI Fridays, Hamilton
    •TGI Fridays, Hazlet
    •TGI Fridays, Linden
    •TGI Fridays, Marlboro
    •TGI Fridays, North Brunswick
    •TGI Fridays, Old Bridge
    •TGI Fridays, Piscataway
    •TGI Fridays, Springfield
    •TGI Fridays, West Orange
    •Villari’s Lakeside, Gloucester Township
    •Yesterday’s Marmora

  70. chicagofinance says:

    Be careful of Middletown and Red Bank cops….always looking to create revenue…..parking in Red Bank is worse than you would expect…..specifically keep your speed within 10 mph of speed limits and don’t roll through stop sign and rights-on-red……the also like to fcuk pretty badly with teenage drivers……in Red Bank they meter maids will stare you in the eye and press the button on their summons-O-meters……

    Juice Box says:
    May 23, 2013 at 1:26 pm
    Chi – I had forgotten how nice downtown Red Bank is, I won’t be missing Hoboken at all.

  71. DL says:

    Re 63: Be careful. I spent many years working congressional liaison and she will be entering an environment where coercion is the coin of the realm. I worked with one couple who met in a DC high rise. The only people they met on the elevator ion their building were members of Congress visiting their girlfriends. Members and staffers live away from home, generally traveling to their home districts/states on Friday and returning to DC on Monday. Most can’t afford to keep their families in DC nor do the families want to live there so the opportunities to wander during the week are great and harassment is common. As long as she’s prepared for the environment, caveat emptor.

  72. JJ says:

    Can people my age be interns, maybe a hot congresswomen or something. That Palin chick looks ok to me.

    DL says:
    May 23, 2013 at 4:52 pm

    Re 63: Be careful. I spent many years working congressional liaison and she will be entering an environment where coercion is the coin of the realm. I worked with one couple who met in a DC high rise. The only people they met on the elevator ion their building were members of Congress visiting their girlfriends. Members and staffers live away from home, generally traveling to their home districts/states on Friday and returning to DC on Monday. Most can’t afford to keep their families in DC nor do the families want to live there so the opportunities to wander during the week are great and harassment is common. As long as she’s prepared for the environment, caveat emptor.

  73. Libtard in Union says:

    Why do I know that a member of the tribe is behind the alcohol scheme. And the markup on booze is already akin to printing money.

  74. Doyle says:

    #73 DL, have you seen House of Cards on Netflix yet? If not, you should check it out.

  75. JJ says:

    http://www.redfin.com/NY/Long-Beach/240-E-Hudson-St-11561/home/20249636

    I love all these short sale flood houses down in Long Beach. Banks must just be upset with this junk to sell

  76. Comrade Nom Deplume, Halfwit Dumbass says:

    [73] DL

    I was in the district when the press hounded Gary Condit into resigning. A colleague lived in his building in adams-morgan and said it was impossible to come and go while the press was in heat.

  77. Libtard in Union says:

    I was right. Oy Vay.

  78. Now, do the lawyers and ABC do some legwork- and find out if/how the wholesalers were colluding with the establishments selling fake booze- or do they just mail it in and claim victory when the usual suspects get hauled off to prison?

  79. Painhrtz - Disobey! says:

    Lib someone always has to live up to the stereotype it is like Italian mobsters.

    Nom 20 minutes and this misery is over if Rask does not slip on a bannana peel and let that crap goal in he would have a shutout.

  80. chicagofinance says:

    REVIEW & OUTLOOK

    The Unaccountable Executive

    If the President doesn’t run the government, then who does?

    [edit]
    If the scandal is showing anything, it is that the White House has a bizarre notion of accountability in the federal government. President Obama’s former senior adviser, David Axelrod, told MSNBC recently that his guy was off the hook on the IRS scandal because “part of being President is there’s so much beneath you that you can’t know because the government is so vast.”

    In other words, the bigger the federal government grows, the less the President is responsible for it. Mr. Axelrod’s remarkable admission, and the liberal media defenses of Mr. Obama’s lack of responsibility, prove the tea party’s point that an ever larger government has become all but impossible to govern. They also show once again that liberals are good at promising the blessings of government largesse but they leave its messes for others to clean up.

    ***
    Alexander Hamilton and America’s Founders designed the unitary executive for the purpose of political accountability. It is one of the Constitution’s main virtues. Unlike grunts in Cincinnati, Presidents must face the voters. That accountability was designed to extend not only to the President’s inner circle but over the entire branch of government whose leaders he chooses and whose policies bear his signature.

    If the President isn’t accountable, then we really have the tea party nightmare of the runaway administrative state accountable to no one. If Mr. Obama and his aides are to be taken at their word, that is exactly what we have.

  81. chicagofinance says:

    from Noonan:
    And we know Jay Leno, grown interestingly fearless, said of the new IRS commissioner, “They’re called ‘acting commissioner’ because you have to act like the scandal doesn’t involve the White House.”

  82. chicagofinance says:

    more from Noonan:
    ……But the most important IRS story came not from the hearings but from Mike Huckabee’s program on Fox News Channel. He interviewed and told the story of Catherine Engelbrecht—a nice woman, a citizen, an American. She and her husband live in Richmond, Texas. They have a small manufacturing business. In the past few years she became interested in public policy and founded two groups, King Street Patriots, and True the Vote.

    In July 2010 she sent applications to the IRS for tax-exempt status. What followed was not the harassment, intrusiveness and delay we’re now used to hearing of. The US government came down on her with full force.

    In December 2010 the FBI came to ask about a person who’d attended a King Street Patriots function. In January 2011 the FBI had more questions. The same month the IRS audited her business tax returns. In May 2011 the FBI called again for a general inquiry about King Street Patriots. In June 2011 Engelbrecht’s personal tax returns were audited and the FBI called again. In October 2011 a round of questions on True the Vote. In November 2011 another call from the FBI. The next month, more questions from the FBI. In February 2012 a third round of IRS questions on True the Vote. In February 2012 a first round of questions on King Street Patriots. The same month the Bureau of Alcohol, Tobacco and Firearms did an unscheduled audit of her business. (It had a license to make firearms but didn’t make them.) In July 2012 the Occupational Safety and Health Administration did an unscheduled audit. In November 2012 more IRS questions on True the Vote. In March 2013, more questions. In April 2013 a second ATF audit.

    All this because she requested tax-exempt status for a local conservative group and for one that registers voters and tries to get dead people off the rolls. Her attorney, Cleta Mitchell, who provided the timeline above, told me: “These people, they are just regular Americans. They try to get dead people off the voter rolls, you would think that they are serial killers.”

    This week Ms. Engelbrecht, who still hasn’t received her exemptions, sued the IRS.

  83. joyce says:

    83
    chicagofinance,

    The author’s point of any one person being able to competently manage such a vast organization is, of course, spot on. However, he needs to reread his early american history vis-à-vis Alexander Hamilton.

  84. joyce (87)-

    Alexander Hamilton? The famous pistol duelist?

  85. moose (89)-

    I am strangely beginning to hate myself for liking you.

  86. WickedOrange says:

    Wall Street Journal ‏@WSJ 2h
    Has the recession frozen people in place? The biggest U.S. cities continue to outgrow their suburbs: http://on.wsj.com/198fuGM

  87. Juice Box says:

    F the city, my pool is open for business.

  88. No equity, no sellers, no sales | New Jersey Real Estate Report

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