It won’t ever sell…

From the Star Ledger:

Bank foreclosing on Joe, Teresa Giudice’s Montville mansion

The same day the new real estate agent for “Real Housewives of New Jersey” star Teresa Giudice vowed to aggressively market their enormous Montville Township mansion, the bank that holds their mortgage started foreclosure proceedings against the couple.

Community Bank of Bergen County filed a notice of foreclosure in Morris County Superior Court Wednesday on their Indian Lane property, according to court papers obtained by NJ Advance Media. The couple had returned to the mansion to the market this week with a $2.99 million listing price.

Community Bank was listed as one of the couple’s creditors in its 2010 bankruptcy filing, with a $1.7 million claim on the property. The couple eventually abandoned their bankruptcy claim after the trustee representing their creditors alleged they hid assets and income, which led to a federal prosecution that netted Teresa 15 months in prison (she’s expected to be out in February 2016) and Joe 41 months. The trustee closed out the bankruptcy proceedings last year after only collecting $7,500; the end of the proceedings gave banks and other credits free reign to seek repayment.

The couple also had two other properties on the market since last year: a vacation home in Manahawkin and a modest three-bedroom home they rented out in Lincoln Park. But they pulled those homes off the market earlier this month. According to Zillow.com, the two homes are in pre-foreclosure, although there has been no notice of foreclosure for the Manahawkin home filed with Ocean County Superior Court. In May 2014, a mortgage holder on the Lincoln Park property filed a notice in Morris County Superior Court, but no further action has been taken.

This entry was posted in Foreclosures, New Jersey Real Estate. Bookmark the permalink.

103 Responses to It won’t ever sell…

  1. grim says:

    From the Wall Street Journal:

    Many Who Lost Homes to Foreclosure in Last Decade Won’t Return

    Less than one-third of families who lost their homes to foreclosure or other distress events in the past decade are likely to become homeowners again, according to an analysis by the National Association of Realtors.

    More than 9.3 million homeowners went through a foreclosure, surrendered their home to a lender or sold their home via a distress sale between 2006 and 2014. Of those, about 2.5 million either have already jumped back into the housing market or will do so within the next eight years because they have the financial ability to purchase and are eligible for a mortgage, according to the Realtor group. Most of the rest won’t be eligible to borrow or won’t have the desire to buy again, the analysis found.

    Real-estate agents and economists have been anxious about the return of formerly foreclosed upon homeowners, whose re-emergence could boost the housing market and the broader economy. Borrowers who went through a foreclosure or other negative event are ineligible to obtain a government-backed mortgage for up to seven years afterward. For families who lost their home in the early years of the crisis, the penalty phases are ending, creating optimism about a large new pool of potential homeowners.

    But Lawrence Yun, chief economist at the Realtor group, cautions that the pool may not be as large as some are expecting. Many won’t return because they are unlikely to improve their credit or income enough to qualify for a mortgage. Even those who have decent credit will be held back by “overly stringent” lending standards. He estimates that 490,000 buyers who are or will be eligible for mortgages backed by the Federal Housing Administration and similar programs won’t qualify unless there is a loosening of stricter-than-normal requirements.

    Others, he said, won’t return due to lack of desire to own a home after being burned during the crash.

  2. anon (the good one) says:

    yesterday was a fairly good conversation, but the extreme right wingers are always very irrational. Michael thanks for yesterday’s contributions

  3. grim says:

    Why is there a concerted effort to seize foreclosures in NJ’s urban areas? Perhaps we should be glad it’s happening, otherwise this might be the result, from Salon:

    Detroit is in foreclosure: Why the Motor City is on the brink of a new kind of disaster

    Unlike so many industrial innovations, the revolving door was not developed in Detroit. It took its first spin in Philadelphia in 1888, the brainchild of Theophilus Van Kannel, the soon-to-be founder of the Van Kannel Revolving Door Company. Its purpose was twofold: to better insulate buildings from the cold and to allow greater numbers of people easier entry at any given time.

    On March 31st at the Wayne Country Treasurer’s Office, that Victorian-era invention was accomplishing neither objective. Then again, no door in the history of architecture — rotating or otherwise — could have accommodated the latest perversity Detroit officials were inflicting on city residents: the potential eviction of tens of thousands, possibly as many as 100,000 people, all at precisely the same time.

  4. Comrade Nom Deplume, the loan snark says:

    [2] irrelevant

    You just keep telling yourself that. Wouldn’t want to burst your bubble too soon by telling you there’s no Santa Claus, . . .oops.

  5. grim says:

    So much for the shore house, from the NY Daily News:

    Beach house owned by ‘Real Housewives of New Jersey’ star Teresa Giudice to be auctioned

    A piece of the Real Housewives lifestyle is going up on the foreclosure auction block.

    The canal-front beach house on the Jersey Shore owned by Teresa and Joe Giudice will be auctioned May 19 by the Ocean County Sheriff’s office, NJ.com reported Monday.

    Bidding for the five-bedroom, two-bath home will start at $100 and increase in increments of $1,000, officials said.

    It’s a far cry from the $347,000 the now-disgraced Giudices paid for the Manahawkin home in 2005.

  6. grim says:

    From National Mortgage Professional:

    Q1 Foreclosure Activity Drops to Eight-Year Quarterly Low

    RealtyTrac has released its Q1 and March 2015 U.S. Foreclosure Market Report, which shows foreclosure filings—default notices, scheduled auctions and bank repossessions—were reported on 313,487 U.S. properties in the first quarter of 2015, down seven percent from the previous quarter and down eight percent from the first quarter of 2014 to the lowest quarterly total since the first quarter of 2007. There were a total of 122,060 U.S. properties with foreclosure filings in March, a 20 percent jump from a 104-month low February and up 4 percent from a year ago—the first month with a year-over-year increase in overall foreclosure activity since September 2010.

    The increase in March was driven primarily by a jump in bank repossessions (REOs), which at 36,152 were up 49 percent from the previous month and up 25 percent from a year ago to a 17-month high—although still about one-third of the 102,134 REOs in September 2010, the peak month for REOs.

    States where first quarter foreclosure starts increased from a year ago, counter to the national trend, included Massachusetts (up 58 percent), Virginia (up 11 percent), Michigan (up 11 percent), and Illinois (up eight percent).

    States where first quarter bank repossessions (REO) increased from a year ago, counter to the national trend, included Ohio (up 54 percent), Maryland (up 39 percent), Missouri (up 34 percent), New Jersey (up 18 percent), and Illinois (up 16 percent).

    States with the highest foreclosure rates in the first quarter were Florida, Maryland, Nevada, Illinois and New Jersey.

    Among metropolitan statistical areas with a population of 200,000 or more, those with the highest foreclosure rates were Atlantic City, New Jersey, Rockford, Illinois, Ocala, Florida, Lakeland-Winter Haven, Florida, and Miami.

    States with the longest average days to complete foreclosure for foreclosures completed in the first quarter were New York (1,475 days), New Jersey (1,115 days), Hawaii (1,058 days), Florida (975 days), and Kansas (963 days).

  7. Comrade Nom Deplume, the loan snark says:

    [3]grim

    I like the gratuitous shot at the right for the California drought, blaming it on climate change. After all, draining the Colorado River and sinking a couple of million wells into the aquifers to provide water to a population far in excess of what the environment can handle had nothing to do with it.

    Or was climate change the fault of the greedy banksters, I’m not clear on that.

  8. 1987 Condo says:

    #5….not sure they actually “paid” anything…

  9. Wily Millenial says:

    My moms the baby boomer is home shopping for her upcoming retirement in FL. Tons upon tons of listings. Relatively cheap, no idea what they’re worth though. I can’t imagine wanting to live in FL… I’d rather be mauled by that coyote.

  10. Comrade Nom Deplume, the loan snark says:

    [9] wily

    “I can’t imagine wanting to live in FL… I’d rather be mauled by that coyote.”

    Save some coyote for me. I could never spend a week there without begging to leave. Though the Keys might be different. . .

  11. Comrade Nom Deplume, the loan snark says:

    I just read that JJ’s favorite dating site is preparing an IPO.

    I was going to speculate on the wisdom of investing in a company that reportedly propagates consumer fraud on a massive scale, but when one considers the market caps of uber and AirBnB, it seems investors care little of the legalities if the company just bleeds cash.

  12. anon (the good one) says:

    @nytimes:
    A pledge to raise the minimum wage to $70,000 a year at one company riles naysayers

    “This is going to be great for his business,” said Tim Kane, an economist at the conservative Hoover Institution at Stanford University. “It will reduce turnover, increase morale and help him build an even greater company,” he said. “But if everybody did it, it wouldn’t have the consequences.”

    Jeffrey Bussgang, a venture capitalist and a senior lecturer at Harvard Business School, agreed that Mr. Price’s move would help him not only retain talented workers but also propel Gravity Payments into the ranks of admired companies, a widely desired perch in the business world.

    Some of that has already happened. Three days after the announcement, Mr. Price’s firm, Gravity Payments, heard from more than 3,500 hopeful job applicants and had signed up several new clients, according to Ryan Pirkle, a company spokesman.”

  13. Ottoman says:

    “Though the Keys might be different. . .”

    The liberal enclaves and their environs are usually the only palatable places to live in red states.

  14. Ottoman says:

    Proximity to 287 would make it a great state run prostitution den / truck stop.

    “It won’t ever sell…”

  15. anon (the good one) says:

    it is not even 9 am, but should we declare this post of the day?

    Ottoman says:
    April 21, 2015 at 8:45 am
    “Though the Keys might be different. . .”

    The liberal enclaves and their environs are usually the only palatable places to live in red states.

  16. Libturd in Union says:

    Otto/Anon:

    Rah, rah. Shish boom baa!

    I can’t wait for you two to realize that you are simply pawns. You do realize that there are more people in the middle than there are at the extremes. Though I do have to give you both a little bit of credit. Most extremists spend all day blowing each other in the comments of the WP/Huffington/NYT and Daily K. You guys at least do it where there is a mix of political views. Still, you two are suckers none the less as are the right wingers here.

  17. Ragnar says:

    Mr. Price is going to find it difficult to afford hiring new people. He’s also going to find that disgruntled employees stay on longer, rather than just finding greener pastures on their own.

    Anyone here work at a firm where there is a group of people overpaid for what they do and contribute? What about the salesman who feels he produced enough value to merit $100k salary, but there’s not enough money to give him a raise from $70k because the company has to pay people half as productive as him $70k too.
    Is the principal involved meaningfully different from “from each according to his ability, to each according to his need”?

    https://thesnarkwhohuntsback.wordpress.com/favorite-passages-from-atlas-shrugged/the-story-of-the-twentieth-century-motor-company-atlas-shrugged-part-ii/

  18. chicagofinance says:

    You forgot to mention the environmentalists diverting water to preserve fish populations and bird sanctuaries……also LA has been allowed to become one vast concrete and tar slab that runs putrified rainwater out to sea versus allow the ground to capture the moisture naturally as fallen rain……..but it is easier to blame Texas yahoos for following their economic interests…..

    Comrade Nom Deplume, the loan snark says:
    April 21, 2015 at 7:48 am
    [3]grim

    I like the gratuitous shot at the right for the California drought, blaming it on climate change. After all, draining the Colorado River and sinking a couple of million wells into the aquifers to provide water to a population far in excess of what the environment can handle had nothing to do with it.

    Or was climate change the fault of the greedy banksters, I’m not clear on that.

  19. Jake says:

    Anon, is Starbucks a greedy corporation because they are not paying their employees a minimum wage of $70,000?

  20. Wily Millenial says:

    I could live in the middle of a red state if it’s Montana or Wyoming. Maybe Pigeon Forge or Louisville or something.

  21. D-FENS says:

    Otto and Anon are so “extreme” left, that everyone else is a right winger to them.

  22. Wily Millenial says:

    Idaho is underpriced for sure.

  23. The Great Pumpkin says:

    It def was. Always enjoy days like that.

    Rags, if you have time, def check out that debate between the austrian school vs the mmt school. Like I have previously stated, I truly believe all these schools of economic thought have their place. I believe different economic problems, call for different economic solutions. You can’t have a one size fits all platform. It doesn’t work, all the economic theories have their inherent flaws. The problem with the Austrian school of thought is that they look at the world as black or white. It’s either the austrian way or no way. This is where they are wrong.

    anon (the good one) says:
    April 21, 2015 at 7:04 am
    yesterday was a fairly good conversation, but the extreme right wingers are always very irrational. Michael thanks for yesterday’s contributions

  24. The Great Pumpkin says:

    Taking it to the extreme. No one is advocating that low level service jobs should get paid 70,000. They are just stating that people should make at least (20,000 a year/10 dollars an hour). No one is advocating for extreme policies like this that will totally destroy the economy. You have to have a sense of balance. Not too high, and not too low. All you want is for people to be able to support themselves without govt assistance. At the same time, you want to put some money in their hands as to create demand for products, which will grow the economy (like everyone wants). But no one is advocating for almost 40 dollars an hour minimum wage thresholds. That’s crazy.

    Jake says:
    April 21, 2015 at 9:26 am
    Anon, is Starbucks a greedy corporation because they are not paying their employees a minimum wage of $70,000?

  25. nwnj says:

    Speaking of distorted compensation, this is ridiculous.

    800 applications, 0 open jobs.

    http://www.nj.com/mercer/index.ssf/2015/04/princetons_police_department_received_about_800_ap.html#incart_river

  26. FKA 2010 Buyer says:

    New Jersey’s Atlantic County led U.S. metropolitan areas in foreclosures during the first quarter of 2015, according to new data.

    The Southern New Jersey area, which includes Atlantic City, had a foreclosure filing for one of every 113 housing units in the first three months of 2015 for a 46% increase compared to the year earlier period, according to RealtyTrac. In March, the county incurred foreclosures in one out of 252 homes, a 165% jump from a year before, the RealtyTrac data shows.

    The median sales price of a nondistressed home in Atlantic County was $159,000 in February compared to $110,500 for a foreclosure home.

    http://www.nationalmortgagenews.com/news/distressed/atlantic-county-nj-leads-nation-in-foreclosures-1049202-1.html

  27. Anon E. Moose says:

    D-FENS [21];

    Anyone to the right of Lenin and Marx are “Extreme” right-wingers to them…

  28. FKA 2010 Buyer says:

    Today’s Privileged News: Never allow your past activities to affect your present pursuits in life. Starting a HF after disrupting the financial markets and destroying a company is the new killing it!!

    Wall Street has strong feelings about Jon Corzine trying to make a comeback

    Former New Jersey Governor Jon Corzine is thinking about starting his own hedge fund, according to the Wall Street Journal, and because of the way his last firm imploded, Wall Street has strong feelings about that.

    “Truth is the larger seeders would never give him money — too much reputation risk,” said one hedge fund executive. “And the family office seeders, like the few billion dollar Russia oligarchs… don’t trust him for anything. So he could start a fund but it’s like a suicide mission at best. He can probably get his friends together for $50 million, but it will be close to impossible to get outside capital.”

    Read more: http://www.businessinsider.com/wall-street-has-strong-feelings-about-jon-corzine-trying-to-make-a-comeback-2015-4#ixzz3XxD16bt6

  29. FKA 2010 Buyer says:

    [30] cont

    Was at a charity fund raising event at Corzine’s place in the Hamptons in the late 90’s. His patio was bigger than my condo. Was a great event and surprisingly the ultra wealthy that was in attendance were pretty cool people. The guys were more about talking about trips somewhere whereas their wives were feeling neglected and busy having fun.

  30. grim says:

    “He can probably get his friends together for $50 million

    Oh boy.

  31. FKA 2010 Buyer says:

    Foreclosure alternative program arrives in Illinois

    With Illinois’ foreclosure rate still far above the national average, a Boston-based nonprofit is extending a lifeline to a select group of Illinois homeowners in danger of losing their homes.

    Boston Community Capital’s goal is to buy the mortgages of qualified homeowners in foreclosure from lenders at a discount, then sell the homes back to homeowners at the current market value, with lower monthly mortgage payments.

    So far, its Stabilizing Urban Neighborhoods program has acquired and resold to homeowners 419 properties, assisting 550 families in Massachusetts, Rhode Island and Maryland. On average, monthly mortgage payments toward the loan balance were cut by 40 percent.

    In effect, the group is reducing the principal on mortgages, the very thing that housing advocates have called for and what has been missing from myriad government-backed foreclosure relief programs.

  32. JJ says:

    http://www.imdb.com/media/rm3872838144/tt0070723?ref_=tt_ov_i

    I am thinking of doing a remake of Soylent Green taking place in Atlantic City in the year 2017. Anyone want to chip?

  33. anon (the good one) says:

    and our taxes will bail him out if he fails again. he’s a doer, a risk taker, he’s creating jobs and he deserves millions in bonuses….that’s exactly what we did during the global financial crisis by bailing out wall st., no?

    welfare is OK if it moves upwards

    FKA 2010 Buyer says:
    April 21, 2015 at 10:29 am
    Today’s Privileged News: Never allow your past activities to affect your present pursuits in life. Starting a HF after disrupting the financial markets and destroying a company is the new killing it!!

  34. Libturd in Union says:

    I bet you voted for him twice ya retard.

  35. jcer says:

    30, friends….I’d bet he’ll get pension dollars from some unions and NJ and he’ll lose it all……

  36. Essex says:

    19. Answer to question 1: Yes.
    And I am certain there are many in the Starbucks company who make $70k and above.

  37. jcer says:

    34. Lib that’s insulting to the mentally handicapped, they don’t want to be compared to the Corzine voters, esp Anon.

  38. Comrade Nom Deplume, who needs to stop screwing around and get back to work says:

    [36] essex,

    Had I agreed to a move, the Deplumes might well be living in Seattle with the missus working as an Asst. GC at Starbucks. But then I’d have to start over in a new state so it wasn’t so palatable.

  39. Comrade Nom Deplume, who needs to stop screwing around and get back to work says:

    [29] fka

    “whereas their wives were feeling neglected and busy having fun.”

    I expect JJ to weigh in any second now. Heck, I thought it was him until I read the address line.

  40. Libturd in Union says:

    Sorry Jcer.

    I know it’s offensive to some, but I wanted to use verbiage common to Anon’s grade level.

  41. grim says:

    Nom – You should have gone, if only because I would have had the chance to work with her. The folks out at the corporate campus are all great. Howard is a hoot. By far one of my most favorite companies to work with.

  42. Pete says:

    #41, oh good next you go can you suggest creating an express line or self serve for people who just want to order a cup of coffee. I skip it 2 to 3 times a week because the line is too long at my local one.

  43. Comrade Nom Deplume, who needs to stop screwing around and get back to work says:

    [42] pete,

    Sorry, I don’t handle first world problems unless I’m paid.

  44. D-FENS says:

    anon and ottoman, serious question, which Democratic candidate would you vote for in a primary election?

  45. FKA 2010 Buyer says:

    [42] Comrade

    I didn’t grow up in the area but some of JJ’s stories sound very familiar to me. We probably crossed paths at some parties and never knew it.

    BTW – the thought of “starting over” is what I currently struggle with in contemplating leaving Wall Street for Philly.

  46. anon (the good one) says:

    @StephenKing:

    Cruz, Paul and Rubio, all running for President.

    Hey, I thought I was supposed to write the horror stories.

  47. Essex says:

    38. I hear you.

  48. Libturd in Union says:

    You all should join me in Costa Rica living the pura vida.

  49. Fast Eddie says:

    Cruz, Paul and Rubio, all running for President.

    Hey, I thought I was supposed to write the horror stories.

    As opposed to a 70 year old, shrill, f.ucking hag who’s voice and cadence makes me want to scratch my f.ucking face off.

  50. FKA 2010 Buyer says:

    As opposed to a parking lot in Newark, buy a large building and convert to storage. This doesn’t take that much to maintain either. If Newark does take a turn for the better, you can then convert back to livable properties. If not, you still make money.

    Think there’s a McDonald’s on every corner? Try counting the number of self-storage facilities dotting the country

    There are more self-storage facilities in the United States than there are McDonald’s, Subway and Jack in the Box restaurants combined.

    The self-storage industry is a lucrative one, too. The Self Storage Association reports that these facilities generated more than $24 billion in revenue in the United States in 2014. It ranks as the fastest-growing segment of the commercial real estate industry during the last 40 years. The industry pays more than $3.25 billion each year in local and state property taxes, according to the association.

    http://www.rejournals.com/2015/04/17/think-theres-a-mcdonalds-on-every-corner-try-counting-the-number-of-self-storage-facilities-dotting-the-country/

  51. Libturd in Union says:

    Does anyone here use self storage? The only people I know who use it are people who collect krap. I mean besides temporary use like when one must move in a hurry. Anyone here use it?

  52. D-FENS says:

    51. – what about just building a small shed on your property, as long as it’s smaller than 100 sqft in most towns, you don’t pay extra property taxes.

  53. FKA 2010 Buyer says:

    I only used self storage when I was transitioning from a condo and rental before I got a home but with a occupancy rate often at 90 percent, plenty of people are.

    Ironically if I didn’t have the space I probably would still have storage. Now I store crap in my basement. I spent all this money on baby swings, baby changers, a regular stroller and a jogging stroller…all gently used.

    Need to do a lil spring cleaning.

  54. Ragnar says:

    My self storage is in my basement.

  55. Not GOPturded says:

    #51 –

    I have used them in the past for several years to store elderly relative’s home medical equipment and assorted hoarded stuff. Some of my stuff got bug contamination. So the places are kept to minimum care. But is a great place to dump garbage that your town will make you sent to some place or you got to wait to a certain time of the month.

    They use predatory pricing software and do not value loyalty. So they give you a great price to start, first year the raise little or nothing, but if you are still there by third year, they figure moving your stuff is costly for you so they jack you up like a slumlord does. I found this out by starting small conversation and talking about pricing with the staff and other box holders.

    On to another subject from Naked Capitalism.

    Nobel Prize Winner Robert Merton Slams Fed for “Negative Wealth Effect” Policies
    Posted on April 21, 2015 by Yves Smith

    Nobel Prize winner* Robert Merton and Arun Muralidhar have charged ZIRP and QE happy central banks with economic malpractice. One of the main justifications for low interest rates is that they create a “wealth effect” by elevating asset prices. People allegedly feel richer and spend more, stimulating growth.

    As we’ve pointed out, the first central bank to try the bright idea of lowering interest rates to spur consumption was Japan in the late 1980s. We know how that movie ended. Japanese banks and companies engaged in what was then called zaitech, or speculation, funded by being able to borrow 100% against urban land.** The result was to massively inflate already-large commercial and residential real estate bubbles, and to funnel Japanese cash into largely misguided and/or overpriced foreign investments.

    Merton and Muralidhar charge that investors are smarter than central bankers and understand the first rule of finance, that what matters is free cash flow. As one wag put it,

    We’re from Darien!
    We’re invincible!
    Living off the income
    Never touch the principal

    Super low interest rates lower incomes to asset owners, producing what they describe as a “negative wealth effect”. The Fed seems to think that retirees and others who live mainly off their assets will happily eat their seed corn, um, liquidate some of their capital gains to make up for the loss of income. Instead, people in that position who come up short most often curb spending.

    Since the economists made their case in Pension and Investments (hat tip Pwelder and EM). It’s a curious choice of venue (one would assume Merton could easily get a comment in the Financial Times) unless the authors wanted to road test their argument before taking it to a bigger audience. Key sections:

    We have each separately made the case that asset pricing theory and investment practice for funding retirement should focus on how much income the member has in retirement instead of the amount of wealth at retirement….

    What does this have to do with monetary policy? Your recent editorial (“Damage of low rates,” P&I, Jan. 26) discusses the effect of low rates on pension funds, and we describe why those in charge of monetary policy should consider an additional cost/benefit analysis of policy as it relates to pension and retirement security.

    A straightforward approach probably familiar to most chief investment officers is that the amount of retirement income that can be purchased by a given value of assets depends on interest rates. A higher interest rate implies that more income can be purchased for the same wealth (i.e., lower liability value for DB [defined benefit] funds). Alternatively, lower interest rates mean that more wealth will be needed to purchase the same income stream. So, with policies to change interest rates, central banks change the price of retirement income. One of the goals behind quantitative easing in the U.S., Europe and even Japan has been to pursue the “wealth effect” — pumping up the value of assets to make individuals richer, thus getting them to spend more and, thereby, prevent deflation. Furthermore, the belief that lower long-term rates leads to more investment has led the Federal Reserve, and now the European Central Bank, to depress long-term interest rates. However, if decision-makers for institutional and retail pension funds and insurance companies are not focused on wealth (as in the standard portfolio selection model), but instead on retirement income as measured by funded status, then the outcome desired by central banks might not be realized. By reducing long-term interest rates, the price of the same retirement income level goes up and the price of other assets measured in terms of income units declines — i.e., relative wealth (funded status) declines and investors are actually poorer, thereby experiencing a negative wealth effect. In a perverse way, lowering long-term rates has dramatically increased the liabilities of DB funds in the U.S., U.K., Canada and Europe (as noted in “Damage of Low Rates,” P&I, Jan. 26), and has lowered funded status dramatically in 2014. Lower rates also raise the cost of the deferred annuity that targets a specific retirement income affecting DC [defined contribution] investors..

    Lower relative wealth means investors need to save more to improve their funded status, especially where regulations are strict (i.e., divert funds from the business to the corporate pension fund or raise contributions for DC investors), and it results in less consumption and investment, and may not remove the deflationary overhang. Alternatively, investors could try to earn a higher return to improve their funded position. However, from 2003 to 2007 — before the financial crisis — funded status declined for most U.S. funds due to declining long rates, and the data shows it possibly led to an increased allocation to risky assets, which ended very badly in 2008….

    An alternate, more sophisticated approach to explaining why QE may not work to stimulate aggregate consumption is, perhaps, because the demographic mix of the U.S. (and most parts of the developed world) has shifted toward older people. Unlike 30 or 40 years ago, the enormous baby boomer generation, and even retirees, are much wealthier (including human capital) than in the past, and they are wealthier than current generations earlier in their life cycle. Since the older cohort would surely assign higher importance to funding retirement, the funded status effect is more pronounced. When long rates go down, baby boomers start saving more instead of consuming, driving asset prices even higher (especially for risky assets, but not housing assets which they already own). So the wealth effect does not lead to an increase in consumption and, potentially, has the opposite outcome…

    We believe it is imperative for central banks and academia to examine this perspective immediately and develop a new monetary policy toolkit, because it would be tragic if the central banks’ attempts to improve economic security with the current orthodoxy leads, instead, to less consumption, less investment and greater retirement insecurity.

  56. Xolepa says:

    Self storage facilities ARE very lucrative in NJ. They don’t hit against many NJ BS regulations (if at all). They increase rates on schedule. What? Don’t like the $15 a month increase? Spend a full two days cleaning up and moving your crap somewhere else. 1 employee at a time all that is needed (some places are totally automated). Cameras everywhere take care of security issues. The most profitable ones have climate control and multiple stories. I did hear several years ago that some areas of NJ were reaching saturation point and banks were loathe to lend.

  57. 1987 Condo says:

    #56..next thing you know there will be a show on TV about people bidding for contents on such units…

  58. Anon E. Moose says:

    Toll [33];

    and our taxes will bail him out if he fails again.

    It wasn’t just a financial bailout of YOUR Jon boy… No charges filed in MF Global client money disappearing, either. Can’t imagine why… http://bit.ly/1Pcajtq

  59. anon (the good one) says:

    Ed, you have my vote

    @Ed_Miliband:

    I am ready to put an end to the tired old idea that as long as we look after the rich and powerful we will all be OK.

  60. Soon to be another NJ expat says:

    Well, my ‘Soon to be another NJ expat’ status has been delayed due to an underground tank sweep which happened to come across a 3’x8′ “area of concern” in the front yard of my under-contract house.

    Gut instinct tells me it’s a buried oil tank, due to the size of the area and it’s location on the exterior side of the basement wall from where the (now former) interior oil tank was. I’ll be getting a backhoe in soon to confirm.

    Home was purchased in 1996 from the original family that built the place in the Watchung Mtns in the 1930’s (near Ragnar’s neighborhood). Attorney tells me that at the time I bought it there wasn’t the legal concern (=laws?) in place requiring disclosure, but maybe I misconstrued her words. I expect a financial nightmare if there’s contaminated soil. Worse, the #%#* thing is right next to the water well so I could have been drinking contaminated water for 19 years (which admittedly tasted pretty good).

    Seeking comments on procedure and and recommendations for trusted pros.

  61. The Great Pumpkin says:

    Still think betting on Newark real estate is a bad idea?

    “Tech companies that move their businesses to Newark could see a double benefit – a financial one to the corporation, and a social one to the city, Audible Founder and CEO Donal

    d Katz reportedly told a crowd of about 700 people at a TEDx Navesink event last week.

    According to a New Jersey Tech Weekly report, Katz shared the story of his company’s move from Wayne to Newark in 2007, and reasons why he would recommend other companies do the same.

    Katz said the city is on the brink of a renaissance, which could be helped by technology companies moving inside its city limits, the report said.

    “We need to invest to make this happen…There really is a way to have capital become missionary rather than mercenary,” Katz said in the report. He spoke about “social impact investing,” which he said has both a financial upside and a measurable social upside, according to the report.

    When Katz moved his corporation to Newark in 2007 he had 120 employees. Now, with Audible being the largest audio book producer in the country and a part of Amazon.com, the company has added an additional 600 jobs, the report said.

    At the talk, Katz also reportedly announced that he is starting a venture fund and accelerator in Newark.

    Katz is not the first to identify the Brick City as a place on the verge of major change. Members of the Baraka administration earlier this year said they felt the types of revitalizations that have hit Jersey City and Brooklyn, N.Y. were on their way to Newark.

    Mayor Ras Baraka has said that he believes the city can experience a renaissance if it can leverage the resources it already has, and create new arts and culture developments.

    “Arts bring cities back to life,” the mayor said at an event in February. “The epicenter of arts and entertainment in New Jersey is here (in Newark).”

    But others have said that Newark has some significant hurdles to climb before it grows. The city’s crime rate is one of the highest in the state, and unemployment rates in Newark outpace most others in New Jersey.

    For Katz, those challenges are ones he said an infusion into the business sector could help overcome.

    “Companies can have hearts and souls. They can produce meaningful work for people and create meaningful legacies,” he said in the report.”

    http://www.nj.com/essex/index.ssf/2015/04/tech_leader_to_other_ceos_move_your_corporations_t.html#incart_river

  62. Ragnar says:

    Soon to be expat,
    Hire JJ and his Mexican crew to clean up as if nothing happened.
    Your buyer probably wants to intensely supervise while you pay, or walk.
    Sorry to hear of your surprise. I hope you find someone good, who finds no leaks.

  63. Soon to be another NJ expat says:

    #62 Thanks for the comment. Yeah it was a surprise to me too… soil is so rocky around here it’s hard to think they’d bury anything that big. The buyer is a builder who wants to see a licensed company handle the tank removal and of course remediation if it comes to that.

  64. Libturd in Union says:

    I’m with Rags. Act like you are putting in a deck or something and on a Sunday, rip that effer out of the ground.

  65. JJ says:

    I use Asians now. My tank removal after Sandy involved DEC pumping out oil for free. Having my Handiman and his two workers cut it loose and I had a retired firefighter who is a “scrapper” pick it up for free and take it away, he was going to sell scrap.

    Only thing was timing. I had to get the guy at my house the exact moment we had it out as any stupid neighbor or inspector driving by could rat you out.

    My Handimen were already there doing something else so I got the tank out for free.

    Oil is expensive and you can sell the contents of an empty tank so I doubt there is oil in there. Why would you allow a buyer to take a metal sweep to your property? If I had a buyer with absestos, lead, testing for tanks I would assume they are jerking me around looking for a discount

    Ragnar says:
    April 21, 2015 at 2:28 pm
    Soon to be expat,
    Hire JJ and his Mexican crew to clean up as if nothing happened.
    Your buyer probably wants to intensely supervise while you pay, or walk.
    Sorry to hear of your surprise. I hope you find someone good, who finds no leaks.

  66. Xolepa says:

    Sunday mornings are the best times. Twenty years ago, a house on my street was being built. It was the customer who owned the land, so not a spec job. Owner was using a general contractor, not doing it himself. GC hired out local excavating guy to do grading, septic, etc. I see one Sunday morning excavator guy pull up with his dump truck. Packed away about 20 yards of stripped topsoil he had piled up right next to the street. I knew what was going on and was about to call the cops. My wife told me to stay out of his business.

  67. D-FENS says:

    I recommend that you put a rag in it, light it, then head for Mexico.

  68. Soon to be another NJ expat says:

    #64 No doubt the most practical course of action is to do that. Buyer ordered the sweep and has expectation of me fixing it ‘properly’ to go forward with the contract… I definitely don’t want the potential exposure of ‘doing it right’ so looks like I’ll have to say goodbye to this deal.

    Naturally the thing is in the front yard, and there’s a county official living on the street (though mostly out of sight) so the JJ-style fix would probably have to be executed under the dark of night. Gonna be a challenge.

  69. D-FENS says:

    ‏@GovChristie
    Call and ask .@NJSenatePres and @VincentPrieto #WheresTheMoney

    Assemblyman Vincent Prieto (201) 770-1303

    Senate President Steve Sweeney (856) 251-9801

  70. Soon to be another NJ expat says:

    #65 – “JJ / why…”

    Never would have imagined I had one, but I guess that was naive. Guy’s a builder so he doesn’t want the exposure – perhaps he’s been burned already.

    #67 – That was my first thought.

  71. Xolepa says:

    JJ, They are sweeping lawns also now for signs of septic distress. Prospective buyers hire guys to tell them if a septic is defective and it’s hard to form a rebuttal, even if the issue is overblown. Just happened to my neighbors SIL, who has a house in our same town.

  72. Statler Waldorf says:

    Perhaps lower crime and the influx of business / “renaissance” will take care of itself?

    “Katz said the city is on the brink of a renaissance, which could be helped by technology companies moving inside its city limits”

  73. Essex says:

    69. The workers will get their money. It’s theirs. They paid into the fund. Oh yeah.c

  74. Hughesrep says:

    51

    I use a storage place to keep boxes of literature, samples, banners, etc. for work, home office is in Boston.

    I rented one big enough so I can also keep the pool stuff in there during the winter.

    My company pays for it. Amazing the crap you see people keeping in those things.

  75. clotluva says:

    Looks like Sen Shelby is looking to shake down the tax prep industry…bet they had a banner year.

    114th CONGRESS
    1st Session
    S. 929

    To repeal the current Internal Revenue Code and replace it with a flat tax, thereby guaranteeing economic growth and fairness for all Americans.

    IN THE SENATE OF THE UNITED STATES

    APRIL 14, 2015

    Mr. SHELBY introduced the following bill; which was read twice and referred to the Committee on Finance

    http://www.gpo.gov/fdsys/pkg/BILLS-114s929is/pdf/BILLS-114s929is.pdf

  76. Ragnar says:

    clotluva,
    DOA. But a good idea. Tax preparers and tax lawyers hate it, Realtors hate it, progressives hate it. But this senator is 80 years old.
    Will the Republican candidate run on a flat tax platform? I doubt it. A candidate winning on that platform might have the political capital to at least simplify the code somewhat.

  77. The Great Pumpkin says:

    Then why did you negotiate this deal with the State unions to begin with? More importantly why did you give your staff double digit raises and your donors almost a billion in tax breaks?

    Guy is pathetic. Keeps trying to get people against each other. Why in the world did he come with this deal if he had no intentions of honoring the deal? Oh yea, I know why. He suckered the government employees into paying a lot more towards their pensions while at the same time decreasing the benefits. So basically he raised taxes on these people and he tricked them into doing it by stating he would make the pension payments. Have no respect for people like Christie. Never ever trust a fat politician, the writing is on the wall for that stereotype.

    D-FENS says:
    April 21, 2015 at 3:29 pm
    ‏@GovChristie
    Call and ask .@NJSenatePres and @VincentPrieto #WheresTheMoney

    Assemblyman Vincent Prieto (201) 770-1303

    Senate President Steve Sweeney (856) 251-9801

  78. The Great Pumpkin says:

    77- Divide and conquer.

    “Republicans…..First lets cut the taxes on the wealthy which creates shortfalls. Next, lets create a mess with pensions (since it mostly impacts union & public sector workers who are usually political foes). Next, lets fix the mess by raising taxes on the middle class. Political class warfare at its finest Gov 64 inch waste.”

  79. The Great Pumpkin says:

    Ahh, we can dream, right? That’s how you know the tax system is unfair, they won’t allow a flat tax that applies to everyone. You mean some people are actually going to have to pay taxes if we pass this? No chance in hell of ever passing.

    clotluva says:
    April 21, 2015 at 4:34 pm
    Looks like Sen Shelby is looking to shake down the tax prep industry…bet they had a banner year.

    114th CONGRESS
    1st Session
    S. 929

    To repeal the current Internal Revenue Code and replace it with a flat tax, thereby guaranteeing economic growth and fairness for all Americans.

    IN THE SENATE OF THE UNITED STATES

    APRIL 14, 2015

    Mr. SHELBY introduced the following bill; which was read twice and referred to the Committee on Finance

    http://www.gpo.gov/fdsys/pkg/BILLS-114s929is/pdf/BILLS-114s929is.pdf

  80. clotluva says:

    Rags,

    Not to mention – he is solidly entrenched in his district…no need for a populist campaign at this point in his career. And no co-sponsors. So while I’d love for it to be a legitimate proposal, there is a lot about it that raises questions as to its true intent.

  81. clotluva says:

    These fine public servants all swear up and down that they want tax reform:

    http://www.finance.senate.gov/about/membership/

    The only thing they probably want more than tax reform is the power that accompanies the threat of actual tax reform.

  82. WestJester says:

    Re relocation
    Recently purchased a 5.5 ac property in the driftless area just west of Madison WI. Previous owners are a gay professional couple renting at 1500/mo while their new home is under construction.
    It was reading this blog that helped me hold out until the purchase made sense for us.
    Thanks to Grim and all here,
    Everything’s Boken

  83. NJT says:

    Re: Underground oil tanks, septic systems, wells and more…

    Last house I sold (2011) had all of the above.

    Realtors wouldn’t even consider marketing it without the underground oil tank being removed despite the place being a remarkable, totally updated, brick ranch on a great piece of property in a good location with all the extras (Finished walk out basement -with bath, Deck, Gazebo, Patio, private back yard, ect.).

    Back then there was a state sponsored program that would reimburse you for up to $5000 AND cover what your insurance wouldn’t IF the tank had leaked. Turned out a local contractor specialized in removal and, OF COURSE, it came out to EXACTLY $5000. She (yes, a woman) was willing to wait for the money (and did all the paperwork which could have filled up a suitcase) without asking me to give her a dime upfront!

    *I heard that program was discontinued because of fraud. Oh well, got mine done!

    BTW – had a new tank installed in the basement. Roth’s are overrated but insurance companies love them! I guess enough claims havn’t had to be paid yet…

    Onto the well. The bar for Fecal contamination has been raised to a ridiculous level. Bleached the sucker (look it up), three times rather than put in system that would have cost thousands. Passed (barely and with a small bribe).

    Septic was less than a decade old and state of the art. Buyers inspector sabotaged it (messed with an alarm gauge – a local contractor told me for…$100) so it would fail.
    ear
    Underground scanned the entire property, too. Found a buried bear carcass (I have no idea how it got there).

    Also, he went and looked up what permits were pulled…DAMN! Two contractors didn’t close them out! (Driveway and deck footings).

    Toughest sale I ever experienced (had to fight the comps., too!) and no, they were not first time homebuyers!

    Hope the new owners (not really as they mortgaged the joint) are enjoying the place as the property tax on it (now) is punishing.

  84. Wily Millenial says:

    NJ is definitely a disaster as a governed state but I’ve lived in several states that are close contenders. Most states are political nightmares. Washington state is the only place I’ve ever seen tax $ actually produce a good quality of life. It’s probably the ballot initiatives.

    I feel like the US model of government is not all that great. It happened to produce a lot of prosperity for a large number of people. Location, location, location.

  85. D-FENS says:

    Gather your pitchforks. Down with the big bad mean rich man.

  86. The Great Pumpkin says:

    Great point!

    “I feel like the US model of government is not all that great. It happened to produce a lot of prosperity for a large number of people. Location, location, location.”

  87. NJT says:

    #85

    Don’t forget the torches!

  88. Wily Millenial says:

    I’m in favor of a flat tax on income, as long as it’s graded in such a way that the tax on $0 is -19,000.

    Uh, and don’t let people cheat with a Roth to get the credit. And I can still deduct my mortgage interest. And certain mining and drilling activities. And munis.

  89. The Great Pumpkin says:

    Think of economics like this. Who is right, quantum physics or ordinary physics? Should everyone studying ordinary physics just drop it and follow quantum physics instead? Would this be a positive result for the field of science? Will physics be better off if everyone forgets newton’s laws and instead only acknowledges quantum physics?

    I think economics is the same. There are theories at the micro and macro level that hold true, but also contradict each other. Does it mean one school of thought is right and the other wrong? No, they both have their place. Eventually, all these theories will play a roll in making economics both stronger and one step closer to a system that works better for everyone. Just think how far economics has come in 200 years. Just have to learn from every economic mistake and progress from it. Repeating the same mistakes is ignorance.

    People rallying around hard currencies like gold are the definition of ignorant. Haven’t they witnessed the extreme boom and bust periods that accompany a monetary system based on gold? So why would they advocate for the gold standard once again? Haven’t we been there, done that? I think in a day and age in which currency can electronically be moved around, why on earth should it be tied to a metal? Maybe I’m missing something, but I just don’t see the logic in advocating for the gold standard.

    “Rags, if you have time, def check out that debate between the austrian school vs the mmt school. Like I have previously stated, I truly believe all these schools of economic thought have their place. I believe different economic problems, call for different economic solutions. You can’t have a one size fits all platform. It doesn’t work, all the economic theories have their inherent flaws. The problem with the Austrian school of thought is that they look at the world as black or white. It’s either the austrian way or no way. This is where they are wrong.”

  90. The Great Pumpkin says:

    Classic!! Lol

    Wily Millenial says:
    April 21, 2015 at 8:18 pm
    I’m in favor of a flat tax on income, as long as it’s graded in such a way that the tax on $0 is -19,000.

    Uh, and don’t let people cheat with a Roth to get the credit. And I can still deduct my mortgage interest. And certain mining and drilling activities. And munis.

  91. D-FENS says:

    @GovChristie: In Trenton, “Make The Payment” means Raise The Sales Tax From 7 To 10% OR Raise The Income Tax By 29%. http://t.co/Qm6JXVd3t5

  92. The Great Pumpkin says:

    Check out this article from USA TODAY:

    Obama: Warren is wrong on trade

    http://usat.ly/1GfO6GK

  93. The Great Pumpkin says:

    92- This joker.

    “Everything I do has been focused on how do we make sure the middle class is getting a fair deal,” Obama said on MSNBC.

  94. Fabius Maximus says:

    #49 Fast Eddie

    Misogynistic, ageist and uncalled for.

    On the ageism, I don’t recall you having and issue with McCain in 2008 or St Ronnie.

  95. Fabius Maximus says:

    Flat Tax would kill the economy. Most businesses could not function under it.

  96. Fabius Maximus says:

    Soon to be another NJ expat

    There is one big piece of advice here. “The First Loss is the Cheapest”. Bite the bullet and call in the experts. Don’t take a back hoe and make it worse. Fix it right and sell the house. If you lose this buyer, you will have to declare the tank to the next buyer. Best case, a few grand for the extraction and soil testing and you get the all clear. A $30K clean up and you might still be able to sell and walk away. Try to hide it and it will come back to bite. You know that builder will talk to your new buyer some day.

    Also the Bleach Shock of the well is great advice.

  97. Libturd at home says:

    I had an issue with McCane. I’m surprised he’s still alive.

  98. Liquor Luge says:

    Joe Giudice is this millenium’s Joey Buttafuco.

  99. Liquor Luge says:

    Most self-storage places are structured as REITs, operate on long-term land leases (like fast food joints, once the land lease is up, tear down the building) and are really plays on the appreciation of the land under the units. The highest and best uses for these properties may well come after the self-storage game is up.

  100. Soon to be another NJ expat says:

    From yesterday’s thread…

    Thanks to all who expressed opinions. +1 on the bleach for the well – this is what the water testing guy recommended to me the other day.

    Re: #96 post on “First Loss is the Cheapest” – I appreciate what you’re saying. Trouble is, I am reading about NJ homeowners having their projects running to twice that 30K figure… no telling what the ceiling is once that can of worms is opened.

    Right now I’m just speculating that there’s a UST, but in truth no digging has been done. Could be a 3×8 piece of sheet metal in that spot for all I know. Prior water tests have always come back OK and there’s no bubbling crude coming up from the ground.

    Seems prudent to consider whether it’s wiser just let this buyer go and wait for a ‘less discriminating’ one and save myself a lot of money and hassle and grief. Or maybe I should just rent the place out if I want some hassle and grief. At least it will provide some cashflow.

    Much obliged again to all for the commentary.

Comments are closed.