How the Fed learned to stop worrying and love bad loans

From the Wall Street Journal:

Jersey Rejuvenation Story

About six years ago, Newark, N.J., seemed to be winning its long struggle to emerge from decades of urban decay, and one of the symbols of that was the opening of Eleven80, a market-rate rental property in a converted Art Deco office building.

The developer, Cogswell Realty, spent about $110 million to develop the 317-unit apartment tower with luxury finishes and a bowling alley in the building that originally opened in 1929. Most significantly, Cogswell was charging market rates of more than $2,000 a month for some units, prices unheard of in downtown Newark.

But now the project has also taken on new symbolism as its defaulted mortgage has been sold. While sales of distressed real-estate debt are commonplace these days, this deal was significant because the seller was the Federal Reserve Bank of New York.

The Fed wound up owning the debt on Eleven80, along with about $6.4 billion in commercial real-estate loans, when it made a $28.8 billion loan to bail out Bear Stearns Cos. in 2008.

Since then, the Fed has been slowly and quietly reducing that stockpile, partly through loan sales. As of Dec. 31, the value of the commercial real-estate loan portfolio had been whittled down to $2.9 billion, according to public documents.

What is less clear is how well taxpayers have made out from the Fed’s efforts to sell off commercial real-estate loans. A spokeswoman for the Fed declined to comment on the disposal of toxic real-estate loans by Maiden Lane LLC, the Fed-controlled company that was established in 2008 to handle all of the Bear Stearns assets taken over by the Fed.

In the case of Eleven80, taxpayers didn’t make out well. Bear Stearns originally made a $54 million loan on the project, which Maiden Lane inherited. In the recent deal, Maiden Lane sold the debt for $35 million to KBS Strategic Opportunity REIT, a nontraded real-estate investment trust managed by KBS Capital Advisors LLC, of Newport Beach, Calif.

The Fed also moved slowly. A trustee began foreclosure proceedings in 2009, but three years later Cogswell still owns the asset. The foreclosure has been complicated in part by litigation related to a construction company seeking payments.

The Fed’s loss could have been worse. Investors’ demand for distressed commercial real-estate loans is rising, and buyers are now paying an average of 50 cents on the dollar, topping the 25 cents on the dollar that soured commercial real-estate debt was selling for when real-estate values hit their troughs, according to Harris Trifon, global head of commercial real-estate research at Deutsche Bank Securities Inc.

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

145 Responses to How the Fed learned to stop worrying and love bad loans

  1. Mike says:

    Good Morning New Jersey

  2. grim says:

    From HousingWire:

    Rentals outshine single-family home purchases: Zillow

    The nation’s rental market continues to strengthen with some big cities seeing rents rise nearly 15% compared to a year ago.

    Nationally, median rents rose 2% from February 2011 to February 2012, while home values fell 4.5% during that period, according to online real estate marketplace Zillow.

    Chicago metro rents increased 8.6% over the past year, in comparison to an 11% fall in home values over the same period. In the Philadelphia metro, rents rose 14.8% annually while home values fell 5.4% year-over-year.

    The Zillow rent index showed year-over-year gains for nearly 68% of metropolitan areas covered by the index. In comparison, only 8% of metro areas covered saw home values rise in the company’s home value index.

    Foreclosures continue to drive down home values, Zillow said. Foreclosure re-sales made up 20.3% of all sales in February, up from 19.3% in February 2011 and nearly flat with their previous peak of 20.2% of all sales in March 2011.

    Foreclosure sales are strongly affected by seasonality, with January and February typical months with high percentages of foreclosure sales.

    “We have made it through the worst of the housing recession with a bottom on the horizon, but the deep backlog of foreclosures, elevated negative equity and high unemployment are all still obstacles on the road to recovery,” said Zillow Senior Economist Svenja Gudell.

    “The rental market remains a bright spot in the housing market, where many markets, especially hard hit ones, are experiencing significant annual rent appreciation and drawing the attention of investors.”

  3. grim says:

    From MarketWatch:

    A slowly healing housing market

    Encouraging reports on the housing market are stirring up optimism about this year’s home buying and selling season.

    But industry watchers say not to get too excited: Even if 2012 brings increased sales and stabilized home prices, they expect for improvement to come slowly, due to a continued subdued demand for housing.

    “Expect the market to improve in the spring, but in baby steps,” said Sam Khater, senior economist for CoreLogic, a provider of consumer, financial and property information. “It’s still getting off the crutches and learning to walk again and that process is going to take a good two to three years before the market is on firm footing.”

    There’s a bit more buyer confidence in the market this year, but that doesn’t necessarily translate to a huge increase in sales, said Mike Larson, an analyst with Weiss Research. “If anything, we’re going to be disappointed in the pace of improvement,” he said.

    Still, numbers like these are bound to inspire hope for the industry: The pace of existing-home sales was at its highest January and February levels in five years, according to the National Association of Realtors. Sales of new homes were up 11.4% in February, compared with the year before, according to the Commerce Department. True, home prices are still falling, according to the S&P/Case-Shiller home-price index, but prices typically lag behind improvement in home sales, economists say.

    While there is increased confidence in the housing market these days, many would-be buyers see little urgency to take advantage of current home affordability, which also works to slow down the pace of sales, Larson said. With mortgage rates low and housing prices still falling — albeit not as steeply — some buyers continue to wait, he added.

    Finally, there’s also the fear factor that many would-be buyers can’t seem to shake, Larson said. They’ve seen how homeowners have been affected by the housing bust, and they’re not willing to take any chances.

    “You talk to people who arguably have the motive and means to buy a home and they’re not in any rush,” he said. “People are gun shy. As long as that is the case, it’s going to be a market that takes a long time to heal.”

  4. grim says:

    Anyone head down to Revel yet? We might take a ride down on Saturday. Any restaurants open? We’re big Garces fans, we head down to Philly on weekends just to eat at Village Whiskey.

  5. Mikeinwaiting says:

    Grim, checked out menu at Whiskey looks great. May have to take a trip. I gather Garces is doing something in Revel also?

  6. grim says:

    I know he took his two most sucessful Philly restaurants and is opening those two in Revel (Amada and Village Whiskey).

    Their burger (Whiskey King) is the best I’ve ever had, anywhere, hands down (Pub and Kitchen is good, but not quite as good). Fantastic pickles as well (yeah, I know that sounds wierd, but once you have their beets, you’ll love the damn things). Duck fat french fries?!? C’mon!

  7. Mikeinwaiting says:

    Grim funny you mention them the beets caught my attention as I make them myself , love beets. Have to get to one location or other, just to many things I want on the menu for one trip but I will try!

  8. Mikeinwaiting says:

    Road trip to Philly!

  9. Dissident HEHEHE says:

    From Panzner

    Americans Agree: There Is No Recovery

    http://www.financialarmageddon.com/2012/04/americans-agree-there-is-no-recovery.html

    Until that changes you can kiss any “recovery” goodbye!

  10. Mikeinwaiting says:

    Grim do I need reservation at the Philly loc in the afternoon?

  11. grim says:

    9 – Problem is, most people would interpret the question to mean, “has the economy fully recovered.” The answer to that will be a resounding no, from across pretty much every demographic and geography, sans the very wealthy (what recession?) and the 12 employees at Instagram.

    The decline was very rapid, and I highly doubt we’ve seen any kind of real re-set of expectations yet. So, when asking a comparison-style question like that, I have a feeling that for most, “out of recession” means we’ve returned back to economic situation that immediately preceeded the housing crash and recession.

    No doubt, the speed of recovery has been incredibly disappointing, and the economic data/news flow hasn’t been anywhere an upwardly sloping linear trajectory. Seems for every time we get a good print or two, we get kicked in the teeth on whatever the next report is, hardly inspirational.

  12. Mikeinwaiting says:

    Duh, on a Saturday.

  13. grim says:

    Is there some reason that the “Financial Armageddon” blog chose to ignore the question, from the same survey, that asked about whether the economy was improving?

    Close to 50% of survey respondents believe the economy is improving. That paints a very different picture.

    http://www.washingtonpost.com/wp-srv/politics/polls/postabcpoll_04082012.html

    5. Regardless of whether or not the recession is over, would you say the economy in your area is improving, or not improving?

    Improving Not improving No opinion
    4/8/12 48 49 3

  14. Dissident HEHEHE says:

    Because it’s not improving!

  15. grim says:

    Gartman dumping gold?

  16. Metroplexual says:

    Do you realize that in addition to fluoridating water, why, there are studies underway to fluoridate salt, flour, fruit juices, soup, sugar, milk, ice cream? Ice cream, Mandrake? Children’s ice cream!…You know when fluoridation began?…1946. 1946, Mandrake. How does that coincide with your post-war Commie conspiracy, huh? It’s incredibly obvious, isn’t it? A foreign substance is introduced into our precious bodily fluids without the knowledge of the individual, and certainly without any choice. That’s the way your hard-core Commie works. I first became aware of it, Mandrake, during the physical act of love… Yes, a profound sense of fatigue, a feeling of emptiness followed. Luckily I — I was able to interpret these feelings correctly. Loss of essence. I can assure you it has not recurred, Mandrake. Women, er, women sense my power, and they seek the life essence. I do not avoid women, Mandrake…but I do deny them my essence.

  17. gary says:

    The job recovery is dead and there’s nothing to indicate anything new and innovative on the horizon. Who has the motivation and enthusiasm when we have the f*ckup-in-Chief pitting the Bourgeoisie against the Proletarians.

    We already know not to send your kids to college for anything IT related unless you enjoy eating veggie burgers or tandoori goat for lunch while earning a salary on par with Target or Walmart. So what’s left? Oh, we’re a service economy now? I’ll over-charge you for nonsense and you can over-charge me with alternative nonsense.

  18. chicagofinance says:

    Max: Christie may be a fat pig and an a%%hole, but this speech is one of the best things I’ve heard in months….

    NJ gov: Entitlements make us lazy
    By ERIK KRISS Albany Bureau Chief

    We’re becoming a couch-potato nation, New Jersey Gov. Chris Christie lamented yesterday.

    A “paternalistic entitlement society” is to blame, he said during a speech at the George W. Bush Institute Conference on Taxes and Economic Growth in Manhattan.

    “I’ve never seen a less optimistic time in my lifetime in this country,” the Republican big declared before a GOP audience at the New-York Historical Society.

    Former President George W. Bush lauded Christie’s “enormous personality” in introducing the man he nominated to be a US attorney.

    The Texan two-term president said his home state has taken note of Christie, adding, “We admire the courageous stance you take” and praising Christie’s “belief in the individual.”

    The Garden State first-termer, considered a rising national Republican star, explained the issue in simple terms.

    Government is now telling people, “‘Stop dreaming, stop striving, we’ll take care of you.’

    “That will not just bankrupt us financially, it will bankrupt us morally, because when the American people no longer believe that this is a place where only their willingness to work hard and to act with honor and integrity and ingenuity determines their success in life, then we’ll have a bunch of people sitting on a couch, waiting for their next government check,” he said.

    The root of the problem: politicians’ hunger to please.

    “I think politicians get themselves into the biggest trouble when they care more about being loved than being respected,” said Christie, who turned down GOP entreaties to run for president this year and endorsed former Massachusetts Gov. Mitt Romney.

    “That’s why we run up these deficits we run up. That’s why we can’t say no to anything, because we care too much about being loved.

    “I’m loved enough at home, believe me — on occasion,” he added to laughter.

    “My mother told me a long time ago, ‘Chris, if you have the choice between being loved and being respected, take respect,” he said. “Because if you’re respected, true love may happen. But love without respect is always fleeting.’

    “Now, of course, she was talking about women. But I think it applies equally to politics,” he explained.

    Touting his record in New Jersey, he declared, “We’re trying to set the example for the rest of the country,” then joked to two of his Southern counterparts that he would “trade my right arm to come deal with Tennessee and Oklahoma rather than deal with New Jersey.”

    But he insisted he’s no hard-liner.

    “Compromise is not a dirty word,” he said.

    Christie has worked with the Democratic-run New Jersey Legislature to slash public-employee pensions and other costs, and has battled with the teachers union over education policy.

    The conference was part of a Bush Institute initiative to promote sustainable 4 percent economic growth.

  19. chicagofinance says:

    Max: You take something benign and twist it. My point was tax the sh!t out of everyone, the 1%…whatever you want….you got it….just stop spending so much fcuking money….

    Fabius Maximus says:
    April 11, 2012 at 12:40 am
    #141 Chi
    “Max: don’t brand me something I am not; I don’t care about taxes.”
    Yep, that pretty much sums you up, just a one side of the equation boy!

  20. chicagofinance says:

    I am not long natural gas…..I am long companies that use natural gas as an input, so their profit margins have exploded as the price has cratered to $2. Who cares about the financial impacts of the industry….I’m sure that Berman either invested himself or else owns a bunch of coal mines and is seething. He certainly can’t be happy about what the Administration has done to screw up the proper functioning of WTI prices.

    All that matters is that there should be a strong and holistic approach to how shale gas is drilled in this country in a responsible manner. Further, how the adminsitration plans to strategically use this resource to protect national interests.

    The Ponzi scheme blew up and we win. I just looked at my gas bill and electric bill for March; both sub-$100 to support a 2900 sq. ft home.

    Fabius Maximus says:
    April 11, 2012 at 12:46 am
    Chi, Here’s one for you?,What is your objective assessment of this quote? I suspect you are long natural gas so I can assume you have done due diligence on the industry.

    “According to Arthur Berman, a respected energy consultant in Texas who has spent years studying the industry, Chesapeake and its lesser competitors resemble a Ponzi scheme, overhyping the promise of shale gas in an effort to recoup their huge investments in leases and drilling. When the wells don’t pay off, the firms wind up scrambling to mask their financial troubles with convoluted off-book accounting methods. “This is an industry that is caught in the grip of magical thinking,” Berman says. “In fact, when you look at the level of debt some of these companies are carrying, and the questionable value of their gas reserves, there is a lot in common with the subprime mortgage market just before it melted down.” Like generations of energy kingpins before him, it would seem, McClendon’s primary goal is not to solve America’s energy problems, but to build a pipeline directly from your wallet into his.”

  21. 1987 condo buyer says:

    #20. Re heating bill, there’s that hidden inflation everyone talks about…..

  22. Comrade Nom Deplume says:

    [19] albani,

    You are taking max way too seriously.

    Since you can’t convince folks of his mindset (especially those that consider Taibbi a “reporter” and I do know some people who do, or worse, they think Dionne is a reporter), just do what I do: Disagree, move on, and take the other side of their trade, metaphorically speaking.

  23. Comrade Nom Deplume says:

    [19] chifi

    Or you can have some fun with them. Like this

  24. Comrade Nom Deplume says:

    [21] seif,

    You comparing Christie to Obama now?

  25. Orange says:

    hit estimates? meet budget? In N.J.? You kidding?

    yeah – ans the big dig was only supposed to cost 2 bil

    you must have roled up and smoked something special in the report about N.J. Having no corruption

  26. Orange says:

    why can’t Obama pay fir it – shovel ready – lets go

  27. gary says:

    Serious question: explain to me how raising taxes creates jobs?

  28. Comrade Nom Deplume says:

    [26] orange

    An agency controlled by the current administration produced this report, which the spokesman blew holes in in no time.

    And don’t even begin to suggest that GAO is an honest broker, a true watchdog. I ‘ve spent enough time in DC and its politics to know better.

    But remember, we are talking about people who think Taibbi is the next Murrow so they will buy it hook, line, and sinker. My advice for dealing with that is to bait hooks.

  29. Comrade Nom Deplume says:

    [28] gary,

    We all drink when someone suggests that Clinton did it.

  30. Comrade Nom Deplume says:

    [27] orange,

    100% fed funded? I think that Christie would endorse that in a heartbeat.

  31. Orange says:

    and why not – maybe Obama can use it to buy N.J. Come november

  32. Orange says:

    god knows we send enough to Washington – how about a bone once in a while

  33. gary says:

    ChiFi,

    Christie is right. We have become such a fat, f*cking stup1d country. I cringe when ridiculous, fringe topics become the core subject for debate in this country. I cringe even more when I hear the logic and reasoning behind it.

  34. Orange says:

    only in uncle frankies world does getting back 50 cents on the dollar mean getting our fair share

  35. gary says:

    Nom [30],

    Why doesn’t the media ever corner TOTUS and pound him with the tough questions?

  36. Juice Box says:

    NY MTA already nixed the tunnel to NJ because of costs too, at $2.50 a rider they would never make their money back. The 2nd Ave Subway right now is tracking $2B per mile. Rail is just too expensive. Keep riding the Bus, it is cheap and there are plenty of them.

  37. Juice Box says:

    re: # 36 – Gary it is all about access. You don’t get a press pass or join the press pool if you ask real questions.

  38. Anon E. Moose says:

    Fab [142, prev thread];

    I refer to it as the “laughing curve” as it’s such a joke!

    You probably also dispute Pythagoras, Euchlid, and Newton — while swearing that Al Gore and the IPCC are preaching on “settled science”.

    For those of you playing along at home, this is what cancels your vote, folks.

  39. xolepa says:

    And soon as that tunnel makes it way half way under the Hudson into NY all the employment and income taxes belong to NY. NJ pays. NY reaps. And most of the work is in NY.

  40. Juice Box says:

    re: # 42- 28k in taxes to live in River Edge? That is insane.

  41. 3B says:

    #42 Jill: I saw that thank you, that patch used to be a sleepy blog, but lately it is exploding in activity, because of the reassessment. At the end of the day reckless spending killed the town. I was talking and cautioning about this for the last 7 or 8 years (to myself of course), now ironically what I have been saying has come to pass.

    It really makes me angry, I loved the town, and the wounds are all self inflicted.

  42. 3B says:

    #43 Juice: 28k Is insane in any town but in River Edge as say opposed to Saddle River, it is down right bizarre, but this is what happens with out of control spending.

    The owners of these 28K a year taxed homes can talk about moving all they want, but who will buy them with those taxes??? Ironically some of the residents complaining moved into town over the last 5 to 7 years, in other words they (apparently) had no idea all the woes the town was facing; otherwise I would assume had they known they would not have bought here. Lesson learned for these people and others looking to buy in any town DO YOUR HOMEWORK and find out what is going on in whatever town you are looking to buy in. The information is all out there.

  43. gary says:

    “I was looking to get started but right now I’m completely shut down due to a lack of interest regarding the taxes,” Polaco said. “These would have been simple houses and I’m stuck with plans and property that I can’t sell. I also have a house on Madison Avenue and those taxes will be between $18-19,000 and the lack of interest there is evident. I have three properties in town that I don’t know what to do with.”

    Sell? Sell to f*cking whom?

  44. xolepa says:

    That town should declare municipal bankruptcy. Can someone tell me what there is to lose by doing so.

  45. Anon E. Moose says:

    45 [3B];

    Who will buy? Nothing price can’t fix. You know how much mortgage $2,300 a month in property taxes would support? At 4% over 30 years that’s like adding over $480k to the purchase price.

    You see, price is a negative feedback mechanism (negative feedback is a good thing in control systems if you want stability — I know you know that, but Fab and Seif might read this too…). If prices go higher, fewer people are willing to pay, putting downward pressure on prices until a stable equilibrium is found.

    On the other hand, property taxes exhibit positive feedback — as prices rise, so does assessed value. The only thing that will bring the assesment down is lower prices. Meaning that price is the (indirect) control, but there is no inherent control in the assesment mechanism.

  46. grim says:

    Can someone tell me what there is to lose by doing so.

    It’s a great plan. The only problem is that the widows and children holding the debt get wiped out.

  47. Juice Box says:

    re: River’s Edge on the Brink. How about a nice sale lease back deal on the whole town. Must be worth at least a billion in real estate alone right?

  48. Libtard and the City says:

    Juice,

    If they need someone to show them the ropes, we are ready, willing and able. Are they from the city?

    “Tard and Gator you have a new neighbor in the ridge. A friend of mine, offer just accepted…”

  49. Juice Box says:

    River’s Edge on the brink. The Chinese want to build special economic zones in the USA. How about they sell the whole town to the Chinese to build an special economic zone?

    I can do this all day, I should have been an Investment Banker….

  50. xolepa says:

    and what widows and children of that town hold that debt? do you think they invested in their own town? Most debt of this type is cut and sliced and dispersed to minimize risk.

  51. gary says:

    Moose [48],

    I’ll help to release someone from their nightmare. A nice 4 bd/2.5 bth at around 250K should ease the pain. After all, we wouldn’t want to deprive the children of their blue ribbon education.

  52. joyce says:

    (49)

    Grim,
    children own muni bonds?

    I’m not indifferent towards the idea of bondhoders getting wiped out, but it is also foolish to loan money to (buy bonds of) an entity that is so poorly run and so much in debt. If the municipalities keep raising all forms of taxes & fees to try to pay their debts off, it’s just not possible as people will sell/walk away. Some towns are just beyond repair at this point (some states and countries too).

  53. Dan in debt says:

    I read Taibbi’s last piece where he blasts republicans for Paul Ryan’s budget. Conveniently, however, he offers no alternative no does he show any Democrat alternative and he doens’t mention that Obama’s budget in the House was defeated something like 419-0. Strange, I don’t recall him blaming Democrats for house budgets from 2006 to 2010 either. OK, not strange just consistent with a liberal who blames Republicans for everything with some mild criticism of Democrats to appear “even-handed”.

    He wrote a good article on the court cases and foreclosures but when it comes to politics, he goes straight down the liberal hack line.

  54. Jill says:

    3b #44: In WT they want to spend $1.8 million for artificial turf for Memorial Field. Because after all, every parent in town thinks HIS kid is going to be the next B.J. Raji (who IS from WT and just built his parents an ostentatious ongepotchket bauble of a house that sticks out like a sore thumb on a through street).

  55. Juice Box says:

    re# 52 – Tard – after the house warming I will let you know, thanks for the offer.

  56. chicagofinance says:

    If you heat with oil, you are seriously SOL…..

    1987 condo buyer says:
    April 11, 2012 at 9:38 am
    #20. Re heating bill, there’s that hidden inflation everyone talks about…..

  57. gary says:

    Jill [59],

    LOL! I had to do a g00gle for that one! :)

  58. Juice Box says:

    re # 55 – Gary you can get that just across the river in Bergenfield with the high taxes to boot.

    http://www.realtor.com/realestateandhomes-detail/Bergenfield_NJ_07621_M60482-52845

  59. Libtard and the City says:

    3B “It really makes me angry, I loved the town, and the wounds are all self inflicted.”

    Sounds like Montclair. What’s the capital debt up to there. I know in Montclair, their capital debt per person works out to 7K. And almost all of it was in short-term notes. How bad is it up in unicornland?

  60. chicagofinance says:

    Did you read the article? First off, it is written by the NYT and its readership, which target rich limosine liberals who live on the UWS of Manhattan. These are people who do not use a car except to drive to the Hamptons. Then the first few subject matter experts are all people who clearly would support public infrastructure works; costs be damned. Interestingly, the amount of stress placed on the idea that the tunnel is critical for the entire Northeast Corridor EXACTLY EXPLAINS why NJ was being screwed, because NYC would get most of the benefit, as well as Amtrak, and yet NJ was on the hook. Further, even thought the PA is a joint NY/NJ agency, it overwhelmingly impacts NJ, because it runs the GWB, HT, LT. Only as the article begins to talk to members of Governnor’s administration do the inconvenient items, such as FACTS actually come out.

    seif says:
    April 11, 2012 at 9:14 am
    18 – add JOB-KILLING LIAR to that list

  61. gary says:

    Juice [63],

    True, but will I be classified as prestigious? And does Bergenfield have a unicorn population? And do the woman have blond pony tails pulled through the back of the their Red Sox caps (Yankee caps are too obvious – Red Sox cap is edgy)? And do they stroll through the park with their puggles pushing buggaboo strollers? These things are important.

  62. Juice Box says:

    Gary – Bergenfield was settled by the same Dutch Farmers that settled most of Bergen County. It does actually have a downtown, and a movie theater, probably more parks than River Edge and they even have a park with a pond you can walk your Bugaboo around. As far as blond pony tails, not too many of them anymore. Bergen County itself has changed allot in the last 20 years, lots of diversity now.

  63. chicagofinance says:

    Here is part of the Christie thing…..
    http://www.youtube.com/watch?v=2_gZvt3z4iI

  64. Libtard in Union says:

    Chi,

    Were you aware that the plans still had the portal bridge at 2 lanes total? So what that you have 4 tunnels, if the trains still had to squeeze across the 2 track bridge just ahead of it. The ARC plan was horrific regardless who was paying for it. I agree that CC was playing politics to avoid raising the gas tax, but in the end, he saved NJ a ton. And I am someone who would have directly benefited from new rail tunnels. Lautenberg aught to summon the GAO to see what a huge waste of money the Secaucus Transfer station was. The building is about 5 times larger than it needed to be.

  65. Juice Box says:

    The GOP needs a bloviator and right now Christie is #1 in line for that job. He has stated he would consider being Mitt Romney’s VP too. Lately has been awfully busy yucking it up with the GOP and sculpting himself into some kind of statesman, he will probably hedge and keep his day job as he runs.
    I bet every teacher in NJ right now is praying not for his death this time but for his exit.

  66. xolepa says:

    (67)
    I don’t know if it’s a good thing or bad – let the readers on this forum decide. My daughter is finishing high school here in Hunterdon county. Before she got her own car, I would pick her up after practice. Seeing all the girls lined up waiting for rides was like looking at a blonde fashion parade. Btw, our chearleaders won the national championships in Florida several weeks ago. 18 years ago our boys won the national Pop Warner championships. Local residents said ho, hum. In the south, they would have made statues of everyone and given them Coke franchises.

  67. xolepa says:

    Talking about train stations, does anyone here remember going through the Elizabethport train station which was right outside of Ironbound? As simple as a train station could possibly be. Handled the Jersey Central line and others for those on their way back and forth to the Jersey city ferry.

  68. xolepa (71)-

    Hunterdon Central is a gulag. Kinda like our skool, N Hunterdon.

    My son is looking forward to topping his sister’s 11 random drug tests there.

  69. joyce says:

    Can anyone recommend the best online search for rentals? (both house rental or apartment rental)

  70. xolepa says:

    (73)r
    It is funny and yet so true. That’s because there are so many over paid administrators that do absolutely nothing. My daughter and her friends notice this and are aware of the tremendous waste in our taxpayer funded institution. They actually have administrators check the length of the girls’ skirts as they arrive to school and monitor the daily ingress and egress activities of the student driving population.

  71. seif says:

    #65
    “The New York Times
    From Wikipedia, the free encyclopedia

    The New York Times…Its website is the most popular American online newspaper website, receiving more than 30 million unique visitors per month.[4]”

    That is why NYC RE doesn’t go down; 30 million limousine liberals all crammed onto the UWS.

    I posted that he lied to kill a project that would have created plenty of jobs. That’s it. Stop tilting at windmills.

  72. seif says:

    Does anybody know…can the HARP program be used for investment properties or is it restricted to your own residence?

  73. grim says:

    Harp 2.0 is primary residence only

  74. Brian says:

    I’m in Fort Lee today, you can see the smoke rising from these fires:

    http://newyork.cbslocal.com/2012/04/11/brush-fire-burns-in-new-jersey-near-the-meadowlands/

    Must be a big fire. There’s an awful lot of smoke.

  75. xolepa says:

    Sorry, grim. I have to call you out on that. I am almost finished refinancing two investment properties under HARP 2.0. Lowering my 4 family and 2 family to interest rates of 4.75, 1/2 pts. It is explicitly written that it applies to all up to 4 units. 5+ don’t qualify as they were never allowed to be held by freddy or fannie. You can be underwater, too. Not my case, though. I would never have been able to get a refi from anywhere else because of the lowered appraisals and my debt ratios – mostly from the same investment properties! But I will be lowering my payments by about $700 monthly.
    Please realize that the mortgages must be currently owned by Fannie or Freddie.

  76. Juice Box says:

    re: #79 – if Xanadu burned to the ground it would not be missed.

  77. Comrade Nom Deplume says:

    [57] dan

    “He wrote a good article on the court cases and foreclosures but when it comes to politics, he goes straight down the liberal hack line.”

    That’s infotainment!

    Seriously, who reads Rolling Stone? Hedge fund traders? It’s why I review a lot of outlets and skip the op-ed stuff. I mean, its nice to hear people pandering to my way of thinking, and perhaps that gets me to linger and watch ads, but I’m the outlier I guess.

  78. Comrade Nom Deplume says:

    [81] juice

    “if Xanadu burned to the ground it would not be missed.”

    You mean its supposed to look like that?

  79. Comrade Nom Deplume says:

    [78] grim

    “Harp 2.0 is primary residence only”

    Seif,

    I haven’t looked at this, but my guess is that there are other regs that define and limit primary residence to keep folks from “moving” into their rentals to get the HARP benefit and then moving out again. So look beyond the definitional section of the statute.

  80. seif says:

    78/84 – thank you.

    I know an investment property owner that has told me they are “working with a mortgage broker who has devised a complex plan to refinance” their property. If they can’t do it, they will sell. The property is underwater. If HARP is not available to them, what other options could be available (other than coming up with more cash for larger % equity)? Maybe they are using HARP.

  81. cessie718 says:

    Grim- You put housing stats out yesterday do you have them for Hudson County…specifically Jersey City 07302. Thanks

  82. xolepa (75)-

    The real insanity is that at N Hunterdon, the athletes are the only kids subjected to random drug testing. Virtually all these kids are the least at-risk to take drugs, either by inclination or the fact that they know piss tests can happen at any time.

    Meanwhile, the lunchroom is an open-air drug bazaar, and kids who come to skool visibly stoned are ignored.

  83. seif (85)-

    BK. You can get judges to cram down principal on 2nd homes and investment properties that way.

  84. Guess I can’t be called a lone nut anymore.

    “A strong case can be made that the fundamental supports of the housing market– demographics, employment, creditworthiness and income–will not recover for a generation. It can even be argued that housing has lost its status as the foundation of middle class wealth, not for a generation, but for the long term.”

    http://www.oftwominds.com/blogapril12/housing-done4-12.html

  85. Anon E. Moose says:

    Brian [79];

    Must be a big fire. There’s an awful lot of smoke.

    Brian, this is not directed at you, but am I the only one who thinks (and thought yesterday) that a rash of large-scale brush fires virtually simultaneously scattered around the tri-state area might have some relationship to one another?

    If only we had an inqusitive free press who had incentice and initiative to…

    LOOK! Here’s another picture of Kim Kardashian doing nude yoga!

  86. Juice Box says:

    How soon till we start seeing NINJA loans again?

    Subprime Credit Card and Auto loans are back

    http://www.nytimes.com/2012/04/11/business/lenders-returning-to-the-lucrative-subprime-market.html?_r=3

  87. Anon E. Moose says:

    Brian [79];

    Must be a big fire. There’s an awful lot of smoke.

    Brian, this is not directed at you, but am I the only one who thinks (and thought yesterday) that a rash of large-scale brush fires virtually simultaneously scattered around the tri-state area might have some relationship to one another?

    If only we had an inqusitive free press who had incentice and initiative to…

    LOOK! Here’s another picture of Kim Kardashian!

  88. xolepa says:

    My oldest was the only one of three that ever got tested. He got tested right after my wife baked a batch of delicious poppy seed cake. You know what results came out of that.

  89. gary says:

    “if Xanadu burned to the ground it would not be missed.”

    Perhaps that’s the idea. ;)

  90. gary says:

    xolepa [91],

    I few years ago, I had to take a drug test for a new job. On the way to the test, I ate two poppy seed bagels with butter in the car driving to the lab location. Yup, had to retake the test as it came up “hot for opiates.”

  91. chicagofinance says:

    I said the “target readership”. If others want to self-identify that is their business. I find the damned thing difficult to tolerate when it so often editorializes in its news.

    seif says:
    April 11, 2012 at 1:52 pm
    “The New York Times
    The New York Times…Its website is the most popular American online newspaper website, receiving more than 30 million unique visitors per month.[4]”

    That is why NYC RE doesn’t go down; 30 million limousine liberals all crammed onto the UWS.

    I posted that he lied to kill a project that would have created plenty of jobs. That’s it. Stop tilting at windmills.

  92. Comrade Nom Deplume says:

    [89] meat,

    I said the same thing pre-crash but it was based on demographics. I did not see the collapse though. I thought there’d be a slow slide as boomers moved out or died.

  93. More from #89:

    “If someone exits college with $100,000 in student-loan debt, how much will they have to earn to qualify for a $100,000 mortgage? How many graduates will earn that sum on a secure basis? Perhaps not as many as is generally assumed.”

    Any questions?

  94. Juice Box says:

    Corelogic “now is a good time to buy” “best time in last two decades”

    Full Report here

    http://www.corelogic.com/downloadable-docs/MarketPulse_2012-April.pdf

  95. gary says:

    Meat [89],

    That article is spot on.

  96. Anon E. Moose says:

    Brian [79];

    Must be a big fire. There’s an awful lot of smoke.

    Brian, this is not directed at you, but am I the only one who thinks (and thought yesterday) that a number of large-scale brush fires virtually simultaneously scattered around the tri-state area might have some relationship to one another?

    If only we had an inqusitive free press who had incenvice and initiative to…

    LOOK! Here’s another picture of Kim K.!

  97. Anon E. Moose says:

    Am I the only one who thinks (and thought yesterday) that a number of large-scale brush fires virtually simultaneously scattered around the tri-state area might have some relationship to one another?

    If only we had an inqusitive free press who had incentice and initiative to…

    LOOK! It’s Elvis!

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

    meat you where never nuts just ahead of the curve

  99. Anon E. Moose says:

    [You wouldn’t believe what’s got the moderation filter in an uproar…]

    Am I the only one who thinks (and thought yesterday) that a number of large-scale brush fires virtually simultaneously [sc@ttered] around the tri-state area might have some relationship to one another?

    If only we had an inqusitive free press who had incentice and initiative to…

    LOOK! It’s Elvis!

  100. AG says:

    Some serious chop in the gold market recently. The daily chart looks absurd. The manipulators are pulling out all the stops keeping it down.

    Too bad China just walked off with another 40 tons of the real stuff.

  101. AG says:

    Australia is about to go boom as well. I was getting a little tired of the Australian arrogance about how good their economy was.

    “Mounting credit card bills drive bankruptcy boom in western suburbs”

    MOUNT DRUITT, Campbelltown and Liverpool have emerged as Sydney’s bankruptcy hot spots as families succumb to mounting credit card debt and chronic unemployment.

    The three suburbs topped a list compiled by the federal agency Insolvency and Trustee Service Australia, which revealed the NSW postcodes most vulnerable to bankruptcy last financial year.

    Read more: http://www.smh.com.au/money/mounting-credit-card-bills-drive-bankruptcy-boom-in-western-suburbs-20120410-1wn1f.html#ixzz1rlgKxnwn

    Read more: http://www.smh.com.au/money/mounting-credit-card-bills-drive-bankruptcy-boom-in-western-suburbs-20120410-1wn1f.html#ixzz1rlg4dIQR

  102. borat the dictator says:

    Hi fiveee

  103. Mike says:

    Meat 89 Lone Nut? I doubt that.

  104. caljn says:

    #57 Dan
    “…he goes straight down the liberal hack line.” Thankfully someone does! Perhaps if there were more, we wouldn’t find ourselves at the end game initiated by Reagan, enhanced by Clinton, and put on steriods by GWB.

    #70 Juice
    Christie needs to work on whatever issues turned him into a corpulent, blowhard bully before he thinks about national office.
    A little self respect there sir…

    #76 Seif
    I never understood the term, “limousine liberal.” You can’t be Liberal and wealthy?
    I am most certainly left of center but I congratulate Mr. Romney and his garage elevating wealth no matter how he got it or where he stores it.

  105. chicagofinance says:

    “limousine liberal” in the way I used it earlier today implies someone who supports said positions, but does so in a hyprocritical way. The best examples would be Al Gore with his pointlessly massive energy wasting McMansion, and “green” Hollywood activists who take private jets.

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

  106. chicagofinance says:

    More in the vernacular……(i.e. NY Times UWS targeted readership)….
    http://www.urbandictionary.com/define.php?term=limousine%20liberal

  107. AG says:

    Re: Christie,

    He is no savior but he is lights out against in comparison to Goldman Sachs CEO and criminal Jon Corzine. Any public union punks that want to criticize Christie better go take a look at what Corzine did to their pension funds between 2007 and 2009.

    Disclaimer: I voted for Steve Lonegan.

  108. AG says:

    Re Al Gore,

    That motherf_cker is the biggest smacktard walking the face of the earth. I simply cannot believe that people would buy into his BS. No one cares that his carbon credit trading scheme got shut down in Chicago a couple years back? For the love of God Americans are naive.

  109. Captain Sunshine says:

    100 –
    Mr. Moose you are right. In fact the government is so sneaky, they also control the weather! I know this because they wanted to make everybody so happy and that’s why there’s been so much sunshine!

    Surprise!

    Hooray!

  110. AG says:

    2013 will be an interesting election in NJ. Probably Steve Sweeney vs Christie. Christie would win seeing his latest polls are showing around 59% approval in NJ. Now if Christie goes national then NJ is once again f_cked.

    No political solution to the systemic problems we have. Only collapse. What happens then is anyones guess but this house of cards will come down by design. Position yourselves to get out of dodge or to capitalize on the opportunity of a lifetime.

  111. Wake me up when it’s time to start executing politicians.

  112. caljn says:

    Right. Al Gore invented climate change to line his pockets.
    Better to bury our heads in the sand and let China and India burn up the planet.

    And any trading scheme shot down was done so for strictly business, said pocket lining reasons. Not because it was a bad idea.
    Yea, that Al Gore. What an a’hole!

  113. Brian says:

    ChiFi, I am so thankful the previous owners of my house dug up the oil tank and converted our heat to Natural Gas. We had our heat cranked this winter because of the baby. It’s tough to compare to last year because of the warm winter we had but, heat and electrical have definitely been noticably cheaper in my household lately.

    I saw an article in the local paper recently too where they reported that JCP&L actually lowered rates. I can’t remember ever seeing an electric company lowering their rates.

  114. caljn says:

    #108 re: pension funds

    Corzine learned from Whitman.

  115. joyce says:

    to caljn & others

    when it comes to important political items, THERE IS NO DIFFERENCE BETWEEN THE PARTIES … they are all criminals

    but go ahead and keep debating the wedge issues to keep most of us divided

  116. Thanks Joyce. Ya took the words right out of my mouth. Nothing disturbs me more than having to listen to people claim that one party represents them more than the other. Unless one is a member of the ruling elite or has 8 digits in the bank, neither party represents them in any way. Yet they cheer for them?

  117. Captain Sunshine says:

    Vote for me this november!

  118. I would have voted for you CS, but I already promised Borat. Hi Fiveeee.

  119. caljn says:

    Hi Joyce: climate change is fact and not up for debate.
    It is only how we choose to deal with it, or not, that is debatable.

    And I am not ready to throw up my hands and say ALL my elected officials are criminals. That would be terribly depressing.

  120. Mikeinwaiting says:

    caljn, get depressed. You may have a few at the local level but that is it, can’t get any farther being honest.

  121. AG says:

    Caljn,

    I have some bike paths I want to sell you. Are you game?

  122. AG says:

    115,

    Re pensions and Whitman,

    Whitman’s legacy doesn’t compete with what Jon “MF Global” Corzine pulled off on your _sses. All scumbags. I agree. Keep your head in the sand a little longer. I promise you that you will be f_cked.

  123. AG says:

    Joyce,

    I agree. I just read my local patch page with an editorial on Barry Obama’s birth cirtificate. The smacktards made me mad with their BS. Never mind me. I simply rant out of disgust and know dam well its already over.

  124. Bocephus says:

    Nothing is over . It’ll be a whimper, Not a bang. T.S. Eliot

  125. chicagofinance says:

    Max: here is an article to back me up; and disprove your shite

    WSJ
    ECONOMY
    Gas Glut Rejiggers Industry
    Electricity Rates Slide and Coal Feels the Heat as Natural-Gas Prices Plunge

    By RUSSELL GOLD, REBECCA SMITH and DANIEL GILBERT

    Plummeting natural-gas prices are pushing U.S. industries into virgin terrain, even beginning to dislodge cheap Western coal from its once-untouchable perch as the nation’s favorite fuel for power production.

    On Tuesday, natural-gas futures settled at $2.03 per million British thermal units—just a hint above $2, the lowest price since January 2002.

    The shock wave for industry could intensify this summer because the U.S. is running out of room to store the glut of natural gas, which could drive gas prices down to sustained lows not seen in decades.

    The situation is “without question, unprecedented,” said Fred Metzger, vice president of gas-storage engineering for Kinder Morgan Inc., KMI +0.34%a Houston-based pipeline giant.

    The natural-gas surplus has implications for a variety of industries. Energy companies that produce gas are seeing revenue shrink and are searching for more lucrative oil. Cheap gas is stealing power-generation markets from coal, spreading gloom across a mining industry that is being spurned by its most important customer.

    Railroads, whose single largest source of revenue is typically hauling coal, are hurting. The economics of building a nuclear plant, wind farm or solar-power installation look shakier than ever.

    The biggest winners from all this: electricity consumers. In February, Boston-based utility NSTAR told its business customers that it will cut their retail electricity rates 34% this spring, to 5.5 cents a kilowatt hour from 8.5 cents. In May, it expects to announce rate cuts for residential customers, too.

    In many parts of the U.S., cheap gas is pushing wholesale power prices down to two cents to four cents a kilowatt hour. In New England, for example, wholesale power prices were often in the three- or four-cent range in February, compared with six to eight cents on average that month from 2006 to 2011, according to the Energy Information Administration.

    Oklahoma Gas & Electric, a unit of OGE Energy Corp., OGE +0.47%has traditionally produced most of its power at two plants fired by coal from the Powder River Basin of Wyoming and Montana. But recently that has started to change, said John Wendling, manager of generation planning.

    The company’s two most-efficient gas plants “are pushing coal out of the way and the customer is benefiting,” Mr. Wendling said, adding that the utility expects to lower its electricity rates this summer for its customers in Arkansas and Oklahoma.

    Energy-industry analysts at Sanford C. Bernstein & Co. said utilities could boost power production from gas plants by 450 million megawatt hours this year, increasing natural-gas consumption by 3.3 trillion cubic feet a year. This equals 13.5% of total U.S. natural-gas consumption last year.

    To be sure, coal isn’t going to be completely displaced; some coal-fired plants sit at crucial locations and are needed to keep the electricity grid stable. Some utilities are contractually bound to take coal deliveries or face hefty penalties.

    Another wild card is the weather, which is the biggest single factor that determines utilities’ consumption of coal and natural gas. High temperatures—and humming air conditioners—would drive utilities to run more power plants, burning more gas and more coal. That could prevent natural-gas storage from filling up by the late summer, some experts said.

    But others argue that storage is simply too full and too much gas is still being produced.

    In the face of a gas glut, it would make economic sense for production to decline—but that hasn’t happened yet. Most new gas is coming from shale rocks, where companies are using a new combination of techniques to unlock vast amounts of gas and oil.

    In the past year, companies have scaled back their hunt for gas, but are still harvesting significant amounts as a byproduct of drilling for oil.

    Indeed, the U.S. has produced more gas, so far in 2012, than during the same period last year, according to industry consultant Bentek Energy.

    Some experts say electric utilities’ growing appetite for inexpensive gas will prevent storage from filling up.

    “The power market will save the day,” predicted Rusty Braziel, an industry consultant with RBN Energy and a former Texaco marketing executive in the mid-1990s, when gas prices last fell below $1.50 per million British thermal units.

    Southern Co., SO +0.32%for many years one of the largest burners of coal in the U.S., has taken the bait being dangled by low natural-gas prices. “We are in the transition in a big way” from coal to natural gas, says Tom Fanning, chief executive of Atlanta-based Southern.

    The company is building three gas-fired plants in Georgia as replacements for coal-fired units—and plans to do more coal-to-gas conversions. This summer, it expects to burn more gas than ever to take advantage of low prices.

    In 2008, when gas prices still were high, Southern got almost 70% of its electricity from coal. Today, it is getting less than half as much power from its coal fleet. Gas-fired plants now are responsible for 46% of its electricity, up from about 16% four years ago.

    Fuel switching is sending shudders through the coal industry because the power industry consumes more than 90% of all domestic coal.

    Eastern markets felt the effects of lower gas prices first, because eastern utilities mostly burn Appalachian coal, which is more costly, per ton, than coal from Wyoming’s giant Powder River Basin, source of about half the nation’s coal.

    But now, “the coal that was least likely to be displaced is being displaced,” said Anthony Yuen, energy analyst for Citigroup Global Markets Inc. He thinks the trend will pick up if prices continue to fall.

    —Kris Maher

  126. LoveNJ says:

    Last one on this post. Good night. Hopefully, I can finish rewiring kitchen and bathrooms this weekend.

  127. Jill says:

    Brian #114: Did you already have a gas line into your house for your stove? I have no gas coming into my house, so a conversion would be a major hassle. I’m also afraid of gas, what with aging pipeline and houses exploding throughout northern NJ. I know that the price is far less and I’ll have to do the conversion eventually, even if it’s just so I can sell. But if you folks can convince me that I don’t have to worry about CO and explosions, I may consider it when my current oil burner goes.

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