From HousingWire:
RealtyTrac: Foreclosure starts post highest jump in more than four years
Foreclosure filings — default notices, scheduled auctions and bank repossessions — were reported on 115,134 U.S. properties in October, up 6% from the previous month. This is still down 6% from a year ago, the latest RealtyTrac Foreclosure Market Report for October 2015 showed.
The rise was caused primarily by a 12% monthly jump in foreclosure starts, with 48,605 properties starting the foreclosure process for the first time in October.
This increase marks the largest month-over-month increase since August 2011, when there was a 24% month-over-month increase. Despite the month-over-month increase, foreclosure starts in October were still down 14% from a year ago.
While this increase isn’t a giant surprise, it did exceed expectations.
“We’ve seen a seasonal increase in foreclosure starts in October for the past five consecutive years, so it’s not too surprising to see the monthly increase this October,” said Daren Blomquist, vice president at RealtyTrac.
“However, the 12% increase this October is more than double the average 5% monthly increase in the past five Octobers, and the even more dramatic monthly increases in some states is certainly a concern. The upward trend in foreclosure starts in those states in some cases could be an indication of fissures in economic fundamentals driving more distress and in other cases is more likely an indication of long-term delinquencies finally entering the foreclosure pipeline,” he added.
Broken up, October foreclosure starts increased from the previous month in 34 states, including California (up 21%), Florida (up 13%), New Jersey (up 15%), Illinois (up 20%), Maryland (up 300%), Washington (up 34%), and Michigan (up 37%).
…
New Jersey accounted for 7,559 properties receiving a foreclosure filing in October, a foreclosure rate of one in every 471 housing units. While the state’s foreclosure activity is down 4% from the previous month, it is still up 87% from a year ago.Recently, Sens. Cory Booker, D-NJ, and Robert Menendez, D-NJ, sent a letter to the heads of the Department of Housing and Urban Development, the Federal Reserve Board, the Consumer Financial Protection Bureau, the Federal Housing Finance Agency and others, saying that the prevalence of zombie foreclosures in the state is seriously impacting the state’s residents and its economy, and they want to know what the federal regulators are going to do about it.
Here is a copy of the letter referenced above:
http://www.menendez.senate.gov/imo/media/doc/Letter%20to%20Housing%20and%20Banking%20Regulators%20on%20Abandoned%20Foreclosures%202015-10-30.pdf
Reading the letter, it seems that they are more concerned with property tax collection than anything else…
Begs a deeper question, if we’re moving towards a homeownership model that is heavily debt leveraged (in the long/long/long term), than shouldn’t the national model shift towards title theory ownership for real estate? If in reality, lenders are holding all of the homes in the country, than why not make the lenders truly responsible, holding the deed to the property, and only providing the current resident with title (for example, similar to how an automobile is financed). Tie in a move away from judicial foreclosure, which would be logical given a shift to title theory, and BOOM – no more foreclosure and zombie problem, ever.
One last comment – I’m shocked to see that Menendez and Booker fail to acknowledge the financial burden represented by NJ’s property taxes and the fact that it’s a major contributing factor to NJ’s foreclosure problem.
This analysis is beyond my pay grade, but I’m fairly confident that the tax increases in the 10 years prior to the foreclosure crisis having a material impact, with property taxes being a major factor in at least 1/4 to 1/3rd of NJ foreclosures, and potentially as high as 50% in select urban areas.
I know our friends at the Federal Reserve Bank of NY still read this site, so I implore you guys, do the study. Inquiring minds want to know. Hi guys, c’mon, throw us a bone here.
I feel the study would implicate NJ’s oversized property tax burden as being a major factor in local foreclosures. Property taxes in low income areas are an incredible burden compared to NJ’s middle and upper income towns.
There are plenty of homes valued at less than $200k in Irvington that pay in excess of $10k property taxes.
Not that I am arguing that we need to soak the rich to pay, but I’m looking at a listing with a sub $200k price tag, with an $11.5k tax bill.
We joke about property taxes being the real “mortgage”, but you have absolutely real cases in NJ where the property tax payment is larger than the mortgage payment, even assuming 100% financing. This is OUTRAGEOUS.
Property taxes doubling in 10 years represents a payment shock GREATER THAN ANY HELOC OR I/O RESET EVER SEEN.
I’m sorry, but I can’t see how skyrocketing property taxes aren’t a significant/material driver of foreclosures in NJ’s urban areas.
NJ needs to be blamed.
just watched the trailer for the Big Short. that last scene with Steve carell and the stripper owning 4 houses and a condo reminded me of back in the day when I had two fios installers in my CHC discussing their properties in Miami
I don’t get the trailer. I think I read the book, but don’t remember (need to check my Kindle history).
Why are they being positioned as heroes betting against the banks?
In reality, it was the monied hedge funds betting against the monied banks. In no way were any of these actions positioned in a way that extracted any single iota of justice for the American people. Rich people bet against rich people and got richer, meanwhile the loser walked away with a consolation prize so large, losing is barely a footnote.
The guys that bet against the derivatives and shorted the lenders were no different from the lenders that caused the issue, they just decided to put their money on black, instead of red, but either way the game was rigged in their favor.
That cast is really spectacular though, it looks like a great movie.
I’m more interested in American Psycho opening on Broadway.
#4..while consolidation of towns and cities seemingly won’t happen, how about creating consolidated Tax Base jurisdictions that are run by somebody that knows something and cares? How about Newark includes, in the tax base jurisdiction (TBJ) the surrounding towns of Irvington, East Orange, etc. Those older smaller urban “cities” are no longer feasible from a tax perspective these dates.
Two takeaways from that letter:
First, it should say that banks aren’t foreclosing just to preserve their bottom lines and comply with capital requirements. Banks aren’t booking foreclosures because it means taking a capital hit that they don’t take if they don’t foreclose. And who enforces the capital requirements? Almost sounds as if the Senators are telling the regulators to give the banks a break on capital rules. After Winstar, that ain’t happening. It’s kabuki theater for the muppets and the recipients of that letter know it (which is why, to a person, they haven’t read it).
Second, the senators say that the foreclosures are not a relic of the financial crisis. Agreed, but did they implicitly throw Obama under the bus? The anonunists (anon, otto, pumps, Rory Martin) and their acolytes (yome, cobbler (where’d he go?), love to blame our current morass on W; aside from demonstrating their ignorance of economics and law, it is now demonstrably false–so say their senators.
[5] anon
CHC? How bourgeoise of you. I know you will want to implement this at once.
https://www.youtube.com/watch?v=mq__Z-Z_Ofs
like Jim Mora, playoffs!? playoffs!?
you ask about justice?! justice?!
grim says:
November 13, 2015 at 8:00 am
Why are they being positioned as heroes betting against the banks?
In reality, it was the monied hedge funds betting against the monied banks. In no way were any of these actions positioned in a way that extracted any single iota of justice for the American people. Rich people bet against rich people and got richer, meanwhile the loser walked away with a consolation prize so large, losing is barely a footnote.
#3 Grim – How long do you have to be past due before you are moved to the curb?
[10] anon
That was actually funny. Whose tweet did you use?
Grim- with a zombie foreclosure property who is paying the property tax? The bank? Im just asking as a home I sold (moved out of , not a realtor) back in 2005 has been abandoned/foreclosed since 2010. Its not been on the market. I would value it at 200k but if the bank is responsible for the back property tax you are looking at $55k in taxes owed on top of a home that’s been sitting empty/not maint for 5 years. What are the banks thinking they could get for it at this point.
If the bank is not interested in taking the collateral back, they have no need to pay the property taxes on behalf of the owner. They have no responsibility to pay. However, they may chose to pay to preserve their position and stem foreclosure being initiated by a junior lien holder.
Because what happens in NJ is that the unpaid tax bills will go to auction (this is the process in NJ, all taxes get paid, if not by the owner than by the buyer at an auction). These tax liens will be purchased and the properties will be used secure the debt. The tax lien holders will attempt to collect the debt, and if unpaid, they will force a foreclosure action themselves.
I forget what the average interest rate is on a tax lien sale in NJ is, but it’s pretty onerous. If someone couldn’t afford the mortgage, the accumulated tax lien interest debt is likely to represent a pretty significant financial burden.
Ah, now I remember, tax lien auctions start at 18% and bid downwards.
Here you go, from the Daily Record:
Towns make millions from tax misery
Hunched over spreadsheets, a dozen or so real estate investors at Manchester’s Oct. 6 tax lien auction barely looked up as they raised their index fingers and methodically called out bids on more than 200 delinquent properties.
● The sale took less than 90 minutes, and when it was over, the township deposited more than $160,000 into the municipal treasury.
● The real drama comes later, when property owners realize just how costly it can be to fall behind on property tax payments. Many of these liens, debt now owned by a range of investors from private citizens to corporations, carry annual interest rates as high as 18 percent. That’s how relatively small tax debts can quickly snowball to many times what was originally owed.
● What’s more, if the debt isn’t paid in full within two years, the lien holder has the right to seize the property through foreclosure. It doesn’t matter if the initial unpaid property tax or municipal water or sewer bill was for as little as $41, as some in the Manchester sale were. That’s been the law in New Jersey for decades.
● Hundreds of these auctions each year put the teeth into New Jersey’s property tax bite.
It’s a system that generates more than $325 million in annual revenue for the state’s municipalities — and huge profits for major Wall Street firms and other institutional players that have muscled out mom-and-pop investors in recent years, lured by the possibility of earning double-digit rates of return.
…
In the Manchester sale, three institutional investors walked away with more than half of the liens. Another 17 percent of the liens, mostly the smallest ones, didn’t attract any bids and defaulted to the township. The interest rate on those liens is 18 percent per year.
“no different from the lenders that caused the issue..”
Careful grim, in the span of two posts you go from reason and logic to the anonunist’s confused dogma regarding the housing crisis.
The underlying problem in the housing crisis – and the crises discussed in the past few days such as trade – is unmitigated greed. Not of evil corporations, but the greed of Pumpkin’s honest, fair, simple, hard working hero/victim “everyman”.
The housing crisis basis was millions of individuals irresponsibly buying sh1t they could not afford. The basis of the trade deficit – all our dollars being shipped to China – is millions of individuals irresponsibly buying cheap plastic sh1t they neither need nor can afford. The basis of the country’s debt crisis – our dollars being sent back to us from China in exchange for notes and bonds we cannot support nor repay – is the irresponsibility of our elected officials spending money on sh1t the country cannot afford.
These crises are caused by the underlying greed and irresponsibility of the actors, not of some Wall Street bogeyman enabler.
I wish you guys could see the inner workings of an investment bank. It is not the Dr Evil, all knowing, string pulling octopus of WJBryan and Bernie. It is reactive.
Tens of millions of people want to (literally) mortgage their future on cheaply built plastic and pressboard boxes? Wall Street will find a way to make it happen, fast and efficiently.
Tens of millions of people want to pay billions for a sock puppet in an IPO with no earnings or business plan? Wall Street will find 20 more to bring public until there is no more demand.
Wall Street is not some Machiavellian wizard behind a curtain controlling people’s decisions. It is a brutally effective enabler. It is the most efficient catalyst possible, cubed on steroids, delivering people *what they want*. It is peoples’ misguided desires and decisions blowing themselves up – mortgages, credit cards, student loans, T bonds.
People kill people’s finances, not Wall Street.
and in turn my taxes bailed out Wall St
as always, profits are private, loses are socialized. my taxes protected banks, hedge funds and fat cats from the evil greed of Pumpkin
leftwing says:
November 13, 2015 at 9:27 am
“no different from the lenders that caused the issue..”
Careful grim, in the span of two posts you go from reason and logic to the anonunist’s confused dogma regarding the housing crisis.
The underlying problem in the housing crisis – and the crises discussed in the past few days such as trade – is unmitigated greed. Not of evil corporations, but the greed of Pumpkin’s honest, fair, simple, hard working hero/victim “everyman”.
The housing crisis basis was millions of individuals irresponsibly buying sh1t they could not afford. The basis of the trade deficit – all our dollars being shipped to China – is millions of individuals irresponsibly buying cheap plastic sh1t they neither need nor can afford. The basis of the country’s debt crisis – our dollars being sent back to us from China in exchange for notes and bonds we cannot support nor repay – is the irresponsibility of our elected officials spending money on sh1t the country cannot afford.
These crises are caused by the underlying greed and irresponsibility of the actors, not of some Wall Street bogeyman enabler.
I wish you guys could see the inner workings of an investment bank. It is not the Dr Evil, all knowing, string pulling octopus of WJBryan and Bernie. It is reactive.
Tens of millions of people want to (literally) mortgage their future on cheaply built plastic and pressboard boxes? Wall Street will find a way to make it happen, fast and efficiently.
Tens of millions of people want to pay billions for a sock puppet in an IPO with no earnings or business plan? Wall Street will find 20 more to bring public until there is no more demand.
Wall Street is not some Machiavellian wizard behind a curtain controlling people’s decisions. It is a brutally effective enabler. It is the most efficient catalyst possible, cubed on steroids, delivering people *what they want*. It is peoples’ misguided desires and decisions blowing themselves up – mortgages, credit cards, student loans, T bonds.
People kill people’s finances, not Wall Street.
18. Anon, make no mistake about it. I am firmly in the camp that the Feds should have let the house of cards come down. No bailouts.
My libertarian, self reliance, personal responsibility streak extends not just to individuals but to corporates as well.
And I truly believe the country and the 310 million individuals comprising it would be better off now had the Feds let the insolvent banks fail.
Grim about your #15/#16.
Everyone forgets when Bret Schundler became mayor of Jersey City. Remember how he got elected, there were 19 candidates, 18 of them were democrats, he was the only republican. He raised a lot of money for Jersey City by having tax lien sales.
Jersey City since Frank “I’m the Law” Hague had incredibly high taxes. McCann and all the previous Mayors had a defacto policy of allowing Jersey City residents to pay whatever they could on their property taxes. It was part of the political machine/political favors that made the likes of McCann possible.
Schundler was the one that took away the fun when he came in. It’s a big reason why Jersey City gentrify faster than expected. A lot of poor working class real estate was taken and flipped into the market.
leftwing, but as we saw in the Yale student video we have become as a country to weak to think through an issue rationally, pull ourselves up by our bootstraps, instead we need to be cuddled that all is alright. We have become a country where every issue I face is someone else’s fault and not my doing.
Grim, so if the banks are making tax payments on the property to keep their position, why not just sell at below market prices. Sitting on a zombie home for 5 plus years, you theoretically in my example wiped out 25% of your value hoping for a turnaround on top of additional value lost due to lack of maint.
The problem with multinational corporations and one man’s solution…..
https://www.yahoo.com/autos/s/jeep-owner-turns-lemon-into-rap-video-hilariously-151111204.html
and our weakness is exemplified by the way we go about always blaming the poor for all of our problems
walking bye says:
November 13, 2015 at 10:04 am
leftwing, but as we saw in the Yale student video we have become as a country to weak to think through an issue rationally, pull ourselves up by our bootstraps, instead we need to be cuddled that all is alright. We have become a country where every issue I face is someone else’s fault and not my doing.
19. LW,
I’m not so sure that the banks did not need to be bailed out. But I also believe in corporal punishment for white collar crimes that exceed a certain amount. The videos could also be put on PPV for entertainment purposes (all profits going back to the taxpayers). The same would go for the so called “credit rating agencies” who basically stated their ratings were only an opinion.
White collar crime does not see fines and penalties as a deterrent, just the cost of doing business.
I believe Americans can come up with a much better deterrent system. One that really works. Start by dragging them out of their offices by their hair like they did the girl in the school.
We know that even 1 million plus fines allow them to sleep well at night.
Too well, perhaps…..
“and our weakness is exemplified by the way we go about always blaming the poor for all of our problems”
No blame, ever, especially if you read the second paragraph of my post 19. Blame is not on my radar, self determination is.
Fact of the matter is that generally the poor have the most severe problems.
Eradicate poverty, eradicate many problems.
From that starting point our two philosophies differ greatly on how.
22 – because selling means marking at market?
“allow them to sleep well at night.
Too well, perhaps…..”
Agree. I know many of the cogs, wheels, and belts in the system well. There was pure fear unlike anything I’ve seen in the Lehman days. They were looking at losing it all. No repercussions – however delivered – has sent a very bad message….
“White collar crime does not see fines and penalties as a deterrent, just the cost of doing business”
Same for blue collar. There is an implicit cost/benefit analysis in everything we do, from crossing the street, to robbing a 7-11, to corporate misdeeds. Same play and act, different stage.
leftwing I agree. There are the poor and there are those that make poor decisions. Usually one can see medical issues either physical and mental with the truly poor. As citizens and humans we cannot marginalize these people.
Lefty (17): For once, I agree with Anon as well as your analysis. I too was in support of letting the IBs fail. Instead, we’ve made too big to fail even too bigger to fail and the moral hazard in bailing them out just invites a repeat of the deplorable behavior that caused the bailout in the first place.
I agree that the IB’s aren’t sinister and they have a place in our world, but when it comes to the government doing the right thing, it always fails because whoever lobbies(pays) the most to our elected wins the prize. In this case, there was no way the IBs weren’t getting bailed. I’m actually surprised HARP and all of the other acronyms aimed at helping the 99% came to be. Though I was not surprised by how unhelpful they were.
The growth of income inequality and laws written so the rich get richer will only continue to make the situation worse. And the dumb political cheerleaders who are not part of the 1% are the greatest fools of all.
Bought a 2003 Jeep Liberty (cash in November that year – paid dealer price – he just wanted to dump it) for my wife. Thing had more recalls than I can remember. However, they fixed all the issues quickly and gave her a free rental while it was in the shop.
Trans. went at about 150,000 but since it was still mint put in another for $2000. In 2012 at 250,000+ the trans. went again as well the A/C unit. Body and int. ( except passengers seat – cigar burn) were still great. Put it on Craigslist for $2000 and had to take it off in a 1/2 hour as I was getting inundated with e-mails.
Walking bye [21];
As a post-script, the college master involved hosted a meeting with the students in his living room, with Yale upper administration in attendance, where he delivered an humiliating kowtow to the cultural marxists who wailed at him in the courtyard.
Thus goes the world.
Physical and metabolic disorders (jj Edition):
http://nypost.com/2015/11/12/worlds-sexiest-dwarf-is-social-media-star/
“Lefty (17): For once, I agree with Anon as well as your analysis.”
Transitive theory then says that anon and I agree.
Cutting out now to hit the Goose hard.
Now if Anon could just get it through his thick skull that the issue is really not partisan, we would have a winner. I am not hopeful.
http://content.time.com/time/specials/packages/article/0,28804,1877351_1877350_1877322,00.html
LW,
No blame placed on the Federal Reserve System? No fraud or criminal negligence occurred contributing to the crisis? (including WS, rating agencies, loan officers, home debtors, and everyone else)?
Phoenix,
I’m very surprised you somewhat support (or say it might have been necessary) propping up the banks. It’s clear you would have done things very differently, how so?
“Same for blue collar.”
Agreed except the little people are regularly thrown in jail, white collar fraudsters not much.
So,
All in favor of the gold standard and free banking (without a govt run federal reserve, and without treasury bailouts), say aye.
Gold standard not so much, but I think we can do without central banks.
33 – Saw dwarf star – it has nothing to do with astrophysics.
Hands Up; Don’t Shoot
Eighth-graders allegedly stab woman to death at car wash, prop her body up for a joyride
BY NICOLE BITETTE NEW YORK DAILY NEWS
Two Missouri teenagers fatally stabbed a woman while she was vacuuming her car and then went on a gruesome joyride with her dead body propped up in the front seat, according to reports.
The two boys, 13 and 14, allegedly stabbed 43-year-old Tanya Chamberlain in the face, neck, chest and hands on Nov. 1 as she visited a local car wash and vacuumed her vehicle, according to documents obtained by KCTV5.
Surveillance video shows the eighth-graders exiting Quick Clean Car Wash wearing distinct hoodies that would later help police identify them as suspects.
The Nov. 1 time change for daylight saving time screwed up the nearby video footage, which shows the boys getting in the vehicle with Chamberlain in the front seat at around 1:57 a.m. — 40 minutes after Chamberlain is seen on camera vacuuming her car, according to the court documents.
A few minutes later the video boots back up and the car is gone, KCTV5 reported.
The documents state that the teens then took off in the vehicle with Chamberlain’s dead body propped up in the front seat with her feet on the dashboard.
Police pulled over the swerving vehicle about 20 minutes later for what seemed like intoxicated driving.
The boys fled from the vehicle and police lost sight of both of them after a brief foot pursuit, KCTV5 reported.
Inside the car, cops found a blood-covered pocket knife, possibly wrapped in Chamberlain’s hair, in the backseat, the documents state.
“I just want to know why. What would make you want to do something like that to a defenseless lady,” Chamberlain’s friend Jeremiah Persinger told KCTV5.
After police released the surveillance footage, neighbors and parents of classmates were able to identify the boys as students at Bernard C. Campbell Middle School in Lee’s Summit, a suburb of Kansas City.
The students showed up for school the day after Chamberlain’s death and a fellow classmate’s mother told police that her son said the boys wore the same sweatshirts to school that day.
And another local mom said the boys came to her house in those same sweatshirts after the time of the murder, KMBC-TV reported.
“I thought it was very unfortunate. It’s kind of shocking how two eighth-graders could do something like that,” Scott Thomason, of Lee’s Summit, told KMBC-TV.
Warrants were obtained for the boys’ homes and lockers where clothing was taken matching up to that seen in the surveillance video, including the hoodies and a pair of black and white checkered sneakers, KMBC-TV reported.
The young teens made incriminating statements during police interviews that only someone involved in the crime would know, according to reports.
It has not been determined if the boys will be charged as adults or juveniles.
1/4 the way there.
https://www.gofundme.com/ez99ww24
Yup. Pretty incredible and I’m sure the family is unbelievably grateful. My son’s daycare center gave $1,500. I am so impressed.
That’s a gorgeous school Chifi.
https://www.google.com/maps/place/Bernard+Campbell+Middle+School/@38.9459112,-94.3506252,3a,75y,181.51h,90t/data=!3m6!1e1!3m4!1smgJ0g50ukvHrABvlkh1lwg!2e0!7i13312!8i6656!4m2!3m1!1s0x0:0x1c7a9433b3654de7!6m1!1e1
Perhaps it isn’t being funded at a high enough level?
What the hell were 8th graders doing out at 1am on a school night, or on any night for that matter. They should throw those kids parents in the same cell as those kids. Of course, it’s an incarceration problem that causes them to do it.
left,
Sorry but your analysis is wrong. From 2003 – 20007, I worked for a mortgage bank/originator then a closed loan due diligence firm,then asset securization firm and finally IB. I saw it all but ultimately the IBs were to blame. They clamored for more and more mortgage debt and created absolutely crazy programs that allowed nearly anyone to get a loan. Sure there was scum in every area and people lied on their loan apps to gorge. Ultimately IB should care whether the million I am loaning out will paid by qualified borrower. The securitization pipe passed the buck to someone else. Borrowers were just pawns to be played. Offer immigrant with no credit and undocumented income, 500k for home in Elizabeth. Tell him it is path to riches. Please that part is easy and not about borrower. Yes, there are evil financial chemists on WS and they are everywhere. Big money means big corruption. Govt and WS collusion were to blame.
37 Joyce,
Those in charge of the banks would have paid a very physical (non – financial) penalty in my world.
“Govt and WS collusion were to blame.”
Now why would the government go to bat for the IBs?
Anon? Can you explain?
“I saw it all but ultimately the IBs were to blame. They clamored for more and more mortgage debt and created absolutely crazy programs that allowed nearly anyone to get a loan.”
If there are more buyers for CMOs investment banks will originate more product. If there are more sellers (borrowers) they will solicit more buyers for CMOs. Until there is equilibrium (and no more money to made) at which time they move on to the next market seeking or selling product.
If people weren’t so greedy (or dumb) to believe $500k of house would get them riches the bankers have no product. If investors weren’t so greedy (or dumb) to believe that they could earn outside returns without excess risk there would have been no buyers.
Again, Wall Street is a mindless middleman. Highly efficient, agnostic, brutally efficient. But middlemen nonetheless.
I can assure you any banker trying to make a market where there is not a willing buyer and a willing seller will not be a banker for long.
Who do you ticket?
Police in Mountain View, Calif. pulled over a driverless Google car after the slow-moving vehicle caused traffic to back up.
http://www.marketwatch.com/story/police-in-california-pull-over-driverless-google-car-2015-11-13
LW,
Pick whatever time frame you’d consider as the beginning of the mania which led to the bubble… why out of nowhere did millions of people pick that moment and those that followed as the time to dive into real estate? Why didn’t it occur previous to that point on the same scale?
Joyce, don’t know. Explain any mania from Dutch tulips onward.
Again, without a buyer and a seller a market does not exist.
IBs are just the intermediaries putting the two together. They really don’t care otherwise.
I can’t explain to you how many Monday morning calls I’ve been on that were a 180 degree hard turn from the prior week. Everyone banging the pavement with high yield pitchbooks, whoops, slight rate and market change and now everyone hops the same flights and meets the same clients with the same earnest conviction that converts are what they want to issue instead.
IPOs? Hot until they’re not. Good period, take a flight and see three teams of your competitors on board the same flight going to the same destination. Market cracks, nobody on any flight and all bets from the previous week are off. High yield rates dip, run a screen on low P/E companies and book flights for two weeks banging on all those clients for stock buybacks. Market turns, see-ya. Ditto any other product.
Buyer and seller matter. The bank only facilitates their wishes.
You don’t think that previous to this time frame we’re discussing individuals always had the desire to buy things such as real estate? There were always several impediments preventing that desire from turning into actual demand.
Biggest problem in this Country is Marketing by deception. How many folks out there sold for sure investments. Yes, they are 3rd party but their job is to sell. They are not obliged to explain the other side of the coin only what you want to hear. Yes, the customer maybe dumb but there should be laws protecting the dumb and ignorant
“If people weren’t so greedy (or dumb) to believe $500k of house would get them riches the bankers have no product. If investors weren’t so greedy (or dumb) to believe that they could earn outside returns without excess risk there would have been no buyers.”
Lefty, if I spewed this nonsense coming out of your mouth, you would let me have it. Your thinking process is fatally flawed. You really are an mvp supporter of the right, so much so that you are blaming borrowers for a mortgage fiasco. Pretty insane. Just think about what you are saying. You are telling me the bankers are just middle men facilitating a deal? Really? Yes, it’s the borrower’s fault for borrowing money they were not qualified for….can I just ask, wtf is the point of a mortgage application, if banks just give money to anyone that asks? Isn’t the banker supposed to investigate the borrower and assess the risk with the loan? You give out a bad loan, you made a bad move and just loss your money that you loaned out. Too bad it didn’t work that way, instead they got bailed out for taking awful risks with who they loaned the money out. Your way of thinking is shot, you blame the person getting scammed, not the person pulling off the scam. Open your eyes and think for a change.
Joyce, yome, and Punkin:
Yes, yes, and yes.
Now for the facts. No investment banker sold to any borrower a house or a mortgage. Ever. I can guarantee you that.
Your stance regarding the investment banks, to bring back the Dutch tulip mania analogy, is the equivalent of blaming the guy with the pushcart full of tulips at the local market for that mania.
He isn’t the one clamoring to buy a flower at multiples of current annual earnings. He isn’t the one who grew it. He is simply the intermediary putting the two together.
If we are to play the ‘blame game’ the responsible parties in the mortgage meltdown (as in any transaction) are the principals – the buyer of the house (creator of the mortgage) and buyer of the mortgages.
If one wants to continue inward from these two opposing ends of the spectrum there are many parties closer to each of these principals than the intermediary investment banks – mortgage broker, realtor, rating agency, etc. But to lay the blame for a transaction in a non-fiduciary market maker’s lap is stretching. Whether for 17th century Holland or 21st century US.
You wanna do me a favor and find my post blaming IB’s? Also find my post blaming ONLY IB’s?
Not sure either exist; please add that to your list of facts.
left,
I think what you are confusing is making the market vs. servicing the market. Risk control is fundamental cornernstone of all IBs. That fundamental was absolutely torn apart then shat on during the bubble. IBs created the subprime explosion by throwing underwriting/risk standards to wayside and pushing people into houses who had no business getting a mortgage. Tricking unsophisticated people into housing investment is easy when prices are going up 10% a year. IBs did everything to keep game going Fraud was up and down the chain (originators, due diligence, ratings etc). I think the first few years of bubble were govt. policy driven but last four were WS fraud machine doing anything to keep money rolling.
It all starts with Fed Policy, so rates fall and now there is a surge of institutional money flowing around hunting for yield and a higher yield perceived to be safe increases demand. The I-Bankers turned a blind eye to origination issues and continued to build more complex products. The bankers ere involved in risky behavior enabled it and then marketed it as a safe investment.
Joyce, then sorry I don’t understand your post 53.
Bystander
“IBs created the subprime explosion by throwing underwriting/risk standards to wayside and pushing people into houses who had no business getting a mortgage. Tricking unsophisticated people into housing investment is easy”
Again, no investment banker in his life ever met a borrower in one of these mortgages. Ever. They did not ‘push people’ into those houses. They did not ‘trick’ people into housing. If someone shows up willing to pay $500k for a house in Elizabeth, gets a mortgage somewhere, and there is an investment banker that can sell that mortgage on the backend absolutely they will do it.
But again, the investment bankers did not push these people into houses. If we must play a blame game and for some reason deflect blame away from the actual borrower, again, there are people with real fiduciary duty to the borrower. Of which the investment banks were not one.
#60
it is like saying, the head of the mob never met the guy that his goons beat up for refusing to pay. So he is not guilty
leftwing……I am almost on board with you…..but you take your IB lack of cupability too far…..the are certainly not alone, but they are far from blameless…..the analogy is cigarette manufacturer or drug cartel syndicate……you have users and street sellers, but you have the upstream machine creating product through nefarious practices (for IB’s ostensibly legal in form over substance ). So how do you absolve IB’s for knowingly selling something harmful?
leftwing says:
November 13, 2015 at 4:31 pm
Joyce, then sorry I don’t understand your post 53.
Bystander
“IBs created the subprime explosion by throwing underwriting/risk standards to wayside and pushing people into houses who had no business getting a mortgage. Tricking unsophisticated people into housing investment is easy”
Again, no investment banker in his life ever met a borrower in one of these mortgages. Ever. They did not ‘push people’ into those houses. They did not ‘trick’ people into housing. If someone shows up willing to pay $500k for a house in Elizabeth, gets a mortgage somewhere, and there is an investment banker that can sell that mortgage on the backend absolutely they will do it.
But again, the investment bankers did not push these people into houses. If we must play a blame game and for some reason deflect blame away from the actual borrower, again, there are people with real fiduciary duty to the borrower. Of which the investment banks were not one.
At least 18 dead in Paris. Multiple shooting sites and explosions. Possible hostage situation too.
http://www.nbcnews.com/news/world/french-police-report-paris-shootout-explosion-n463186
Left,
And to prove my point, how much of bubble would have been avoided with the following statements:
1. I am sorry sir but you need to put down the required 20%.
2. Sorry, our minimum FICO to qualify for all programs is 650.
3. I am sorry sir but we will need to verify your stated income and assets.
Instead, banks created programs of every kind to draw in any moron and keep the machine turning.
Should there really be a mortgage market for someone with no job, no down payment, no assets? Perhaps but not backed by taxpayer money. Seems like the market was created, not just serviced.
Lefty, plain and simple, the bankers created their own demand by creating customers out of thin air by giving people money that were not qualified for it. That’s what drove up prices and that’s what caused the crash.
A heroine dealer spots his customer 10,000 worth of heroine. This heroine customer kills himself by overdosing. The heroine dealer is payed back the money by the tax payer. You are telling me the heroine dealer is not the problem, it’s the addict?
Didn’t read it yet, but let me guess, Muslim terrorists?
NJGator says:
November 13, 2015 at 5:04 pm
At least 18 dead in Paris. Multiple shooting sites and explosions. Possible hostage situation too.
http://www.nbcnews.com/news/world/french-police-report-paris-shootout-explosion-n463186
ZQZ5 up today, oil at a 40 handle, terrorists in Paris, Retailers finally admitting what the WMT chart has been telling them for months…
Fed raise?
The Original NJ ExPat says:
November 10, 2015 at 10:46 am
Hmmm…..ZQZ5 is looking like a December Fed rate hike is a lock, but proprietary indicators indicate otherwise. False flag?
I’m thinking:
1. Falling stock market leading up to the Fed meeting (with some excellent blue chip buying opportunities)
2. Santa Claus rally that gets ignited when the Fed fails to raise once again.
BTW, where’s JJ? Since he only posts from work, my guess is that he got canned and is hustling to find one of the few and far between white collar wall street jobs where they are looking for higher paid people as old as me;-)
Wonder how well Hillary does running in a
depressionrecessionlittle dippy thing?By: depends on your rhetoric…..for some, it is not about equality of treatment, but rather outcomes……so some would argue (not me) that these criteria are discriminatory, or worse……………racist…….you pig…..
Bystander says:
November 13, 2015 at 5:04 pm
Left,
And to prove my point, how much of bubble would have been avoided with the following statements:
1. I am sorry sir but you need to put down the required 20%.
2. Sorry, our minimum FICO to qualify for all programs is 650.
3. I am sorry sir but we will need to verify your stated income and assets.
Instead, banks created programs of every kind to draw in any moron and keep the machine turning.
Should there really be a mortgage market for someone with no job, no down payment, no assets? Perhaps but not backed by taxpayer money. Seems like the market was created, not just serviced.
CNBC guy on the phone right now, Bob Windrem, is a dick. He’s said multiple times that this is a “successful terrorist attack”. Over and over again. He’ll be getting the Bill Maher treatment soon, and I don’t think HBO will be offering him a show. It’s interesting how they put his name on the bottom of the screen, very prominently, after he repeated “successful…” many times.
Obama making a statement in a few minutes. I’m sure he’ll say that the hostages had it coming, being that they were all French, and stuff.
S&P futures not looking too positive for Monday’s open.
@JohnCassidy:
Obama hails liberte, egalite, and fraternite as universal values.
Says “this is a heartbreaking situation” and “we will bear with them”.
“So how do you absolve IB’s for knowingly selling something harmful?”
Not absolution. I understand it’s comfortable having a ‘money changer’ as the bogeyman, from biblical times through present. I get it. Big and scary. And therefore our problems are not our fault.
My issue is putting a fiduciary relationship on someone who has none and has never had any direct involvement with the ‘injured’ party, while others closer to the ‘injured’ party have that relationship and are off scot free.
I’ve trained my kids….there are the phrases ‘same side of the table’ and ‘other side of the table’ for a reason. Know which side your counterparties are on.
As for By…
No problem. Totally agree. Implement those rules and you would not have had a bubble. Problem as it relates to IBs is that they did not (and do not) control those rules. There were people free and willing to by that crap, and others willing to create it by signing the mortgage. The bankers got in the middle…that’s what they DO. The principals are supposed to do the diligence.
He11, for all I care implement a rule that no asset can appreciate in price more than 5% p.a. Won’t ever have another bubble anywhere. Again, though, the IBs don’t control that. They work the market they are given.
@Olivianuzzi:
PSA: No one needs your take right now.
The Original NJ ExPat says:
November 13, 2015 at 5:43 pm
Obama making a statement in a few minutes. I’m sure he’ll say that the hostages had it coming, being that they were all French, and stuff.
42,
Interesting that there was no mention of the story that the alleged murderers were black and the victim was white. The video showed it however. Had two black boys been murdered by a white woman do you think the news story might have mentioned that. Any chance that there would have been hundreds or perhaps thousands of people standing around protesting?
Rags….yep
Lefty, they created their own artificial market, what don’t you understand? How do you not understand this? They are the market makers, yet you act like they have no impact whatsoever on the market. Of course, let’s blame the poor guy with no knowledge of financials, or how they work, for taking out a loan he/she should never have been approved for. The guy giving the loan is not at fault for giving it to an unqualified buyer? Of course not, let’s just say you have no problem with corrupt lenders just like you have no problem with corrupt ceo’s that are selling out America for an easy dollar.
A few Americas dead according to reports.
Also those Hsotage situation Bataclan concert hall, Eagles of Death Metal were playing there that night.
http://www.latimes.com/entertainment/music/local/la-et-ms-hostages-taken-at-eagles-of-death-metal-show-at-bataclan-in-paris-20151113-story.html
I don’t understand…..why is it one or the other? Both are culpable…..also, who said that IB are fiduciaries, or even need to be……we are discussing what can be construed as “fault”………what is your definition of fault? Obviously yours is violation of a fiduciary business relationship…..some people would use a legal or regulatory definition, others just follow a moral construct……my rule is pretty simple…..answer this question…..are you being a fcuking prick….yes or no?
leftwing says:
November 13, 2015 at 6:12 pm
My issue is putting a fiduciary relationship on someone who has none and has never had any direct involvement with the ‘injured’ party, while others closer to the ‘injured’ party have that relationship and are off scot free.
75
You’re arguing against a strawman. Stop acting like pumpkin; no one here is making the claims you’re attempting to refute.
Ps. Was / is that your industry and are these topics hitting too close to home?
OPINION COMMENTARY
The Climate Agenda Behind the Bacon Scare
The widely publicized warning about meat isn’t about health. It’s about fighting global warming.
By JULIE KELLY And JEFF STIER
Headlines blaring that processed and red meat causes cancer have made this steak-and-bacon-loving nation collectively reach for the Rolaids. Vegans are in full party mode, and the media is in a feeding frenzy. But there is more to this story than meets the (rib)eye.
With United Nations climate talks beginning in a few weeks in Paris, the cancer warning seems particularly well timed. Environmental activists have long sought to tie food to the fight against global warming. Now the doomsayers who want to take on modern agriculture, a considerable source of greenhouse-gas emissions, can employ an additional scare tactic: Meat production sickens the planet; meat consumption sickens people.
[edit]
Now we get to the connection between climate alarmism and the meat-is-bad movement. In advance of the Paris climate talks, the World Health Organization released a lengthy report about climate pollutants and global health risks. The section on agriculture discusses the need to direct consumers away from foods whose production emits high levels of greenhouse gases: “A key action with large potential climate and health benefits is to facilitate a shift away from high-GHG foods—many of which are of animal origin—and towards healthy, low-GHG (often plant-based) alternatives.”
The report specifically mentions red and processed meat: “In affluent populations, shifting towards diets based on careful adherence to public health recommendations—including reduced consumption of red and processed meat and/or other animal-sourced foods in favor of healthier plant-based alternatives—has the potential to both reduce GHG emissions and improve population health.”
How would this shift in consumers’ tastes be produced? “Experimental and modeling studies demonstrate that food pricing interventions have the ability to influence food choice,” the report states, before favorably citing a study in the United Kingdom of “taxing all food and drinks with above-average GHG emissions.”
Much of this is aimed at the U.S., which is the world’s top producer of beef and its third-largest producer of pork. Americans, along with Australians and Argentines, are among the world’s biggest per capita meat-eaters. Now climate busybodies can shout that meat causes cancer and is as bad for the person eating it as it is for the planet.
In other words, meat is a double threat that governments should contain. Hang on to your T-bones and sausages, folks.
Ms. Kelly, a cooking instructor and food writer, lives in Orland Park, Ill. Mr. Stier leads the risk analysis division at the National Center for Public Policy Research in Washington, D.C.
re # 83 – “modern agriculture, a considerable source of greenhouse-gas emissions”
From what I have agriculture is less than 10% of the total annual contribution. Power via burning coal and gas is the major polluter.
Most parties to the mortgage crisis were guilty. Fannie & Freddy. Investment bankers. Mortgage bankers. Mortgage investors who didn’t do due diligence. Rating agencies. Govt agencies and regulators. Central bankers. Home buyers and home flippers.
I think I banks get the most ire today because they mostly got away with their part without punishment. But so did the Fed and Barney’s frank.
When do we just tell Isis controlled countries that if they don’t surrender, we’ll go all Hiroshima on their hairy asses?
Sorry, had to take some time off to kick some puppies and slap some babies.
This started with a reply to one of the first posts today that stated that the banks caused this issue. And it took off from there with people making the ‘strawman’ statements, Joyce and Chi.
After that, yeah, I’m a f.ucking prick. A prick who’s trying to raise two children – one of whom turned 18 this week – to be responsible adults in a community totally lacking any self control, personal responsibility for their own actions, and the ability to even understand either concept.
Tired of the total lack of individual accountability and the chorus of apologists for these clowns. It’s your life, not someone else’s, own it.
G’night all.
I think you misunderstood what I posted. I wasn’t calling you a prick. I was using it as a question for an IB to assess their own role in the morass. Sorry if you were offended…..
leftwing says:
November 13, 2015 at 11:48 pm
Sorry, had to take some time off to kick some puppies and slap some babies.
This started with a reply to one of the first posts today that stated that the banks caused this issue. And it took off from there with people making the ‘strawman’ statements, Joyce and Chi.
After that, yeah, I’m a f.ucking prick. A prick who’s trying to raise two children – one of whom turned 18 this week – to be responsible adults in a community totally lacking any self control, personal responsibility for their own actions, and the ability to even understand either concept.
Tired of the total lack of individual accountability and the chorus of apologists for these clowns. It’s your life, not someone else’s, own it.
[77] I don’t understand why they don’t phrase it the standard way. Shouldn’t it go something like this:
Two Missouri [armed black] teenagers fatally stabbed a[n unarmed white] woman while she was vacuuming her car and then went on a gruesome joyride with her dead body propped up in the front seat, according to reports.
The two
boysarmed black teenagers, 13 and 14, allegedly stabbed 43-year-old Tanya Chamberlain in the face, neck, chest and hands on Nov. 1 as she visited a local car wash and vacuumed her vehicle, according to documents obtained by KCTV5.I think this is pretty brilliant (while honeymooning in Paris):
Tom Lee
@tjl
trying to figure out what petty axe I’d like my eulogizers to grind on my behalf should the unthinkable happen. bike lanes, maybe?