From the Sun Times:
Housing equals economic pressure
This past week’s economic news revealed some startling statistics regarding the state of both the U.S. economy as well as certain factors exercising downward pressure on the nation’s capital markets.
Now, I know this is a column dedicated to the world of finance. However, the potentially biggest threat to the health of the U.S. economy is the “backlash” from the artificial and unsustainable housing market “bubble.”
It is simply impossible to ignore the potential impact that this housing collapse could have on the strength of the U.S. economy, which in turn, affects the values of our traditional investment portfolios.
It is no surprise that the economy is experiencing tremendous negative pressure from the struggling auto makers as well as nearly every U.S. commercial airline. This scenario illustrates just how strong the economy has been, given that the Dow Jones Industrial Average continues to maintain record territory.
While the Federal Reserve keeps a watchful eye on any inflationary pressures which could adversely affect the fragile condition of the economy, there are new fears now fueling the fire of a major economic slowdown.
This week, the National Association of Realtors released data that sales of existing homes nationwide were not only down, but in fact slumped by the largest amount in seventeen years. The single biggest slump in 17 years?
Because this housing “fiasco” has now begun to take the forefront as possibly the single largest factor in the future of the U.S. economy, it is time for the real estate community to take action to save themselves as well as the economy as a whole.
…
Certainly there are many other pressures at work as we navigate the “choppy waters” entering 2007. There is plenty of opportunity for this economy and the overall health of the American consumer’s buying power to flourish if all of the pieces fall into place.If the Federal Reserve Board can find the road map to the ever elusive “soft landing” and “Bernanke’s Boys” can keep this economy from falling into a recession, then 2007 could actually turn out to be a winner for capital market investors everywhere.
However, should this economy slip onto recession, the results could become catastrophic. Recession, perhaps the most feared word of all with regards to the real estate industry, could put the recovery window back several years or more.
Certainly now is the time for investors to be patient and prepared. Keeping a long-term perspective is critical now more than ever as we keep a watchful eye on consumer confidence as well as the overall health of the U.S. economy.
How about a Networking Get Together for all regular folks on this board? There were lot of good restaurants mentioned yesterday.
We could use site like http://www.meetup.com to plan it.
Reasons to be cheerful
Jan 31st 2007 | NEW YORK
From Economist.com
A year into his job, Ben Bernanke of the Fed may feel cautiously optimistic about America’s economy
http://www.economist.com/daily/news/displaystory.cfm?story_id=8624149&top_story=1
From the Daily Record:
Expert: Real estate market will slow, not stall in ’07
2007 will be a good year for real estate, though the market will slow, Stephen Blank, senior resident fellow with the Urban Institute in Watchung, told representatives of the real-estate industry Wednesday night.
Blank does not expect a meltdown in the market, though he said people in real estate will have to make money the old-fashioned way, by hard work.
Joseph Riggs, group president of the Northeast Region at K. Hovnanian Cos. in Red Bank, was asked whether he had seen a worse situation in the state regarding regulation.
He said no. “It’s worse and worse. It’s hard to be optimistic. Just getting property-tax reform is hard.
“I believe that many government leaders know what needs to be done” but are frustrated, he added.
Riggs called for New Jersey to foster freer markets for real estate while “being sensitive to environmental issues.”
From the AP:
Pulte Homes Swings to 4Q Loss
Pulte Homes Inc., one of the nation’s biggest homebuilders, said Wednesday it swung to a fourth-quarter loss, hurt by slumping home closings and a large inventory charge amid the weakening housing market.
The company reported a quarterly loss of $8.4 million, or 3 cents per share, compared with a profit of $574.5 million, or $2.19 per share, in the same period a year ago. Total revenue declined to $4.39 billion from $5.13 billion.
Wall Street, on average, expected a loss of a penny per share on revenue of $4.14 billion, according to an analyst poll by Thomson Financial.
During the quarter, Pulte said closings fell 20 percent to 12,566 homes, offsetting a rise in average sales price per home of 6 percent to $341,000, primarily due to geographic changes in where homes were sold. The company’s backlog value, as of Dec. 31, was $3.6 billion or 10,255 homes, down from $6.3 billion or 17,817 homes in the prior year.
Also hurting the quarter was about $350 million, 88 cents per share, in charges related to adjustments to land inventory and land held for sale.
“We witnessed some promising signs of stabilization at the conclusion of the quarter, and into the first month of 2007, although it’s too early to tell how strong and sustainable this may prove to be in the months ahead,” President and Chief Executive Richard J. Dugas Jr. said in a statement.
Also from the AP:
Centex Construction Unit Sold to Balfour
Home builder Centex Corp. said Thursday it is selling its commercial construction unit to British engineering and construction company Balfour Beatty PLC for about $362 million in cash.
“The sale further simplifies our portfolio and supports our strategy of focusing on our core home building operations,” said Tim Eller, Centex chairman and CEO.
The deal is expected to close by March 31, subject to regulatory approval.
Centex said the sale will help the company focus on its core homebuilding operations. In July 2006, the company sold its sub-prime home equity lending group, Centex Home Equity Co., and its British home building operations, Fairclough Homes, in September 2005.
Good opportunity to short into strength if one has courage. But the real overlooked story is the price of gold, over $650, with continued negative returns on real interest rates, as no one that spends any amount on anything would believe the urban myth that inflation is under control, this is quite a good environment for gold, copper, etc. Eventually, the economy is going to choke itself to death, I believe the over supply of housing has sealed this housing industry’s doom for many years to come, low interest rates or not. Too bad, I do alot of tax returns for small business home builders. Gold is my hedge, my clients get wiped out but my gold stocks go up. Maybe within the next few years we’ll get decent positive interest rates on bonds, but I’m not holding my breath.
Did anyone see Ask The Governor on NJN last night?
Disclaimer
The information on this site is provided for discussion purposes only. Under no circumstances does this information constitute a recommendation to buy or sell securities, assets, or otherwise.
Personal Income/Spending/Savings Rate due out at 8:30am and ISM out at 10am.
Everyone here knows how much I enjoy the savings rate data.
jb
Interesting move by American Standard this morning, selling off the kitchen/bath business.
jb
James I checked CNNMoney.com but couldnt find anything relative to American Standard. Do you have a link plz??
Will they go?
From Forbes:
MSA to Close, Consolidate Plants
Mine Safety Appliances Co., a maker of protective equipment for military and construction workers, miners and firefighters, said Tuesday that it will close two U.S. plants and consolidate operations in Mexico.
The Pittsburgh-based company plans to shut plants in Evans City, Pa., and Clifton, N.J., and move operations from two sites in Mexico to a new factory being built there as part of a plan to improve efficiency.
Many employees at the facilities will be offered new jobs with the company, the company said in a statement. Spokesman Mark Deasy said “it’s hard to say at this point” whether there will be layoffs.
…
The Clifton plant will be shut by year’s end, and its fire helmet manufacturing operations will be shifted to a plant in Jacksonville, N.C. Many of the factory’s 70 employees will be offered jobs at the Jacksonville plant or another company facility.
tbw,
American Standard to spin off one division, sell another
thanks :)
Here is a funny one about a 1 bedroom house in Bergenfield (aka wasteland) that isn’t selling even under $300k, from the Realtor General Message Board:
“THIS MAY VERY WELL BE THE LAST HOUSE IN BERGENFIELD UNDER 300K,CURRENTLY A ONE BEDROOM. SOON TO BE TAKEN OFF THE MARKET,BY OWNER, AND MADE INTO A TWO BEDROOM BY ADDING A FEW WALLS. NATURALLY THE PRICE WILL BE GOING UP. LAST CHANCE FOR SOMEONE TO DO THE WORK THEMSELVES AND SAVE A LOT OF MONEY???HOUSE VACANT AND ON LOCKBOX…….TOMORROW MAY BE TOO LATE????ANY QUESTIONS CALL AGENT OTHER THAN JUST BEING A ONE BEDROOM, THIS HOUSE IS IN MOVE IN CONDITION!!!!!!!”
I love the question marks lol
MLS # 2635163 if anyone wants to save a ton of money????
tbw,
My favorite are the Craigslist postings the ones that describe how great an investment a particular property is.
… if it’s such a great investment, why sell?
jb
“the artificial and unsustainable housing market “bubble.””
This sentence says it all.
Mike T [#6],
Hopefully it[gold] continues to be overlooked. It’s just climbing the wall of worry. Everybody talks Dow, Dow. Well go ahead and price the Dow [over the last few years], in Gold, Euro’s or even Crude terms. The Dow is the laggard. Gold has outperformed the Dow every year for the last 5 years. Believe me, you don’t want the bobbleheads touting it. $650, GLD and $660, April contract are huge resistance #’s. I do not remember witnessing a gold rally of $9 into a FOMC statement.
Down the street from my mothers house in prestigious River Edge, a builder just purchased a 3 bedroom ranch in decent condition for $473,000 OLP was $539,000 and property taxes on this 75 x 100 lot were $9,250.
Currently they are tearing the house down and putting up (you guessed it) a wooden box with that big window above the front door to showcase the Home Depot chandelier. It will be interesting to see how long the new house stays on the market and what it sells for. Being that the builder paid $473,000, he will probably start the price for the new house at close to a million.
For those of you that think the credit binge will last forever, time to wake up. The alarm is going off.
“U.S. regulators, including the Federal Reserve, issued a joint statement in September calling on banks to raise loan standards and increase disclosure for interest-only mortgages and option ARMs, whose minimum payments often fail to cover the interest owed and increase the total size of borrowers’ debt. That prompted officials in 24 U.S. states to establish similar directives and some already have been set.”
`Banging on the Door’
“More regulation may eliminate the ability of homeowners with adjustable-rate mortgages, like Jones, to refinance with new loans, leaving them vulnerable to higher payments. Some mortgage bond investors say that may hurt both current loans and the overall housing market, according to Dale Westhoff, a senior managing director at New York-based Bear Stearns Cos., the largest underwriter of mortgage bonds. ”
“Lenders such as General Electric Co.’s WMC Mortgage, Accredited Home Lenders Holding Co., New Century Financial Corp., and Fremont General Corp. have raised their criteria for sub- prime loans.”
http://www.bloomberg.com/apps/news?pid=20601109&sid=aNoc4LFUSOKw&refer=home
re: american standard
it seems like a crazy business to run: you got kitchen and bath stuff, your vehicle control stuff, and your air conditioning. Kohler has the same issue. They have plumbing, they have power generation, and they have furniture.
have you guys tried this? you have to use NY house purchase (since NJ isnt available yet) but really goes much deaper into the calculation of home purchase than we do when we do hypotheticals here. worth a try if you have 5 minutes and are still doing the ‘rent vs. buy’ thing…
enjoy.
http://www.housemath.us/
comparing gold to traditional indexes is so century. capitalization indifference is today’s new benchmark. pull a couple of popular ETF’s and do the compare and that’s a better benchmark of gold’s performance.
Richard,
The ETF mirrors the index, whether it’s the Dow, Euro, or Crude ETF or any index that suits your fancy. Also, the ETF’s are new. I am talking about the past 5 years. Where do I find GLD in 2002??? There is absolutely no difference, comparison wise, whatsoever.
#9,
“With real spending rising faster than real disposable incomes, the personal savings rate fell to negative 1.2%, the lowest since August. For all of 2006, the savings rate was negative 1%, the lowest annual savings rate since 1933”
http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BD75C93AA%2DBD01%2D4640%2DB12A%2DB953932232DF%7D&siteid=mktw
Savings rate down again…
2006 personal savings drop to 74-yr. low
ListenToWhat’shisface said:
“Challenging the dominant and collective mindset on this blog is exactly why its readers, especially those who do not post (and who read the blog after work hours), should pay attention to my postings.”
I like this comment. If you take your head out of your __ and think. The purpose of this blog is to challenge the dominant and collective mindset that prevails in real-estate.
It costs nothing for a *Real Estate Investor* like yourself to try to browbeat people into buying into this ponzi scheme with their hard earned money/income/savings.
If a buyer wants to hear only good things about housing and how it will never decline, there are other web-sites that cater to this mindset including the NAR website. This website is helpful to people who may want to hear a dissenting opinion about real-estate. End of the day, I don’t really care as every one is responsible for their on financial future. The information/hype/data is out there for everyone to see and make a decision.
from the Daily Record
EAST RUTHERFORD–2007 will be a good year for real estate, though the market will slow, Stephen Blank, senior resident fellow with the Urban Institute in Watchung, told representatives of the real-estate industry Wednesday night.
Blank does not expect a meltdown in the market, though he said people in real estate will have to make money the old-fashioned way, by hard work.
Joseph Riggs, group president of the Northeast Region at K. Hovnanian Cos. in Red Bank, was asked whether he had seen a worse situation in the state regarding regulation.
He said no. “It’s worse and worse. It’s hard to be optimistic. Just getting property-tax reform is hard.
“I believe that many government leaders know what needs to be done” but are frustrated, he added.
Riggs called for New Jersey to foster freer markets for real estate while “being sensitive to environmental issues.”
Allen J. Magrini, vice president and assistant general counsel of Hartz Mountain Industries, was elected president of the New Jersey chapter of the National Association of Industrial and Office Properties at the group’s meeting Wednesday night.
To add to my earlier proposal on Networking,
How about we have our own Ask the Expert kind of program. For e.g. with RE Attorney, CPA, even expert like Prof. Hughes from Rutgers etc…
Of course one has to moderate the questions to ask, probably collect them in advance.
I have done events like this in past, albeit on different subject (Immigration…), so organizing one would not be an issue.
Press release from Experian:
Experian-Gallup Survey Shows Nearly Half of Consumers Say Housing Price Collapse Is Possible in Their Local Residential Real-Estate Market
According to the latest Experian-Gallup Personal Credit Index(SM) survey, nearly half of all consumers (47 percent) say they think a housing bubble and collapse of housing prices is very likely (16 percent) or somewhat likely (31 percent) in their local residential real-estate market within the next three years.
This is up from the 37 percent of Americans who felt this way in May 2005 and the 42 percent voicing this opinion in April 2006.
(Lots of great stats in here)…
One in four homeowners say they have a first mortgage and a home-equity loan and/or line of credit. One in three homeowners under the age of 50 have this combination of loans, compared with 25 percent of those 50 years of age but younger than 65. Only 8 percent of homeowners 65 years or older have a first mortgage and a home-equity loan/line. Thirty-six percent of
homeowners with annual incomes of $75,000 or more have a first mortgage and a home-equity loan/line. One in four homeowners (24 percent) with incomes of $40,000 a year but less than $75,000 have this combination of loans. Only 15 percent of homeowners making less than $40,000 a year have such a loan combination.
About one in five consumers (18 percent) think the average price of houses in their local area actually will decrease over the next year. This
is up from just 5 percent who felt this way in May 2005 and 11 percent in April 2006. Expectations for a decrease in average housing prices are greatest in the West (23 percent) and the East (22 percent) — areas experiencing the sharpest run-up in prices during recent years — and less pronounced in the Midwest (16 percent) and the South (11 percent). Twenty
percent of consumers with annual household incomes of $75,000 or more say they expect housing prices to decline over the coming year, compared with 18 percent of those with incomes of $40,000 a year but less than $75,000 a year and 15 percent of those making less than 40,000 a year.
nearly half of all consumers (47 percent) say they think a housing bubble and collapse of housing prices is very likely or somewhat likely in their local residential real-estate market.
This is actually a very big shift in opinion. A year ago, most people were aware of a possible housing bubble and many believed it existed somewhere else, but most didn’t think it applied to their local market. Their local market was somehow special and immune from a housing bubble (i.e. nice weather, good jobs, close to a big city, highly desirable …take your pick).
This seems to indicate that the NAR is losing ground in its “it’s difference here because ______” local spin campaign.
Seems to me that the general public is really foolish when it comes to financial matters. I think everyone just follows the herd.
Great time to own Sirius stock..
What a ride XHB
ISM manufacturing index falls below expansion point in January, according to Reuters. Details soon.
cnn.com
ISM drops into contraction..
U.S. Jan. ISM manufacturing index 49.3% vs 51.4% in Dec.
Factory activity in the United States contracted in January, the Institute for Supply Management reported Thursday. The ISM index fell to 49.3% in January from 51.4% in December. The decline was unexpected. The consensus forecast of estimates collected by Marketwatch was for the index to rise to 52.0%. A reading below 50 indicates contraction. The index had been above 50 since May 2003 but slipped below that level in two of the past three months. New orders fell to 50.3% in January from 51.9% in December. The employment index inched higher to 49.5% from 49.4%. The price index rose to 53.0% from 47.5%.
must be a disconnect on WS.
hov tol rocking, all is well.
The proverbial shift has begun. Once perception and psychology changes, then the real fundamental changes in the market begin to surface. Doesn’t bode too well for the spring savior. Not only does this shift in psychology deter those to buy, it also may push those on the fence to sell. Don’t underestimate the psychology in this market. Greed/fear was the engine that drove this market to its heights. Greed/fear will also be the engine that drives this market on its downward trend.
2006 Personal Savings Drop to 74-Yr. Low
Thursday February 1, 8:57 am ET
Personal Savings Rate for 2006 Drops to Negative 1 Percent, the Lowest Level in 74 Years
WASHINGTON (AP) — People once again spent everything they made and then some last year, pushing the personal savings rate to the lowest level since the Great Depression more than seven decades ago.
The Commerce Department reported Thursday that the savings rate for all of 2006 was a negative 1 percent, meaning that not only did people spend all the money they earned but they also dipped into savings or increased borrowing to finance purchases. The 2006 figure was lower than a negative 0.4 percent in 2005 and was the poorest showing since a negative 1.5 percent savings rate in 1933 during the Great Depression.
http://biz.yahoo.com/ap/070201/economy.html?.v=8
“disconnect”
pesche,
Not really. It’s called massive short interest. Clot and I discussed this approx 1-1/2 weeks ago.
If it makes anyone feel better, my personal savings rate is at an all time high:)
In fact, I bet most of the commenters here can say the same. At least be happy with that – it means some people aren’t wallowing in credit card debt. Sure we may be the minority but it’s still a positive.
Yeah, though sometimes I think the masses are going to round up the saving few like you and me(e.g. Logan’s Run), then implant a credit card in our palms.
The minority who save are going to get trounced…the minority takes that risk.
gold 666.30 +8.40
thatbigwindow #19. There are currently 10 McMansions for sale in River Edge, and 8 that I know of under construction/reconstruction, nto on amrket yet.
The ones currebtly on the market range in price fro 89gh 600’s, to over 1 Million.
There wa also a ranch on 5th Avenuethat was in sad shape listed for 375K that just fell off the mls, so I assume it sold, and I assume it is a tear down, but better then the guy paying 470 for a tear down.
There was a mayor and coucnil meeting ont he 15th of Jan, to address the McMansion issue, an ordinance that was being considered restrictinh height etc was thrown out by the mayor and council.
The reators were out in force that noght claiming that the towns values would drop if the ordinance was passed (the values are already dropping).
A lot of one truck builders are going to get slammed hard, still tearing down, and building, while so many Mc Mansions sit.
Tell your Mom to hold on, the tax increase this year is going to be even worse, 15 newclass rooms scheduled to open in Sept of 07.
So now You will 2 tier taxes in River Edge, 12 to 15k a year and more for your older capes, ranches, and Colonials, and 15k to 25k a year or more for you McMansions/ Home Dpeot Specials.
It is really sad what is happening to River Edge.
Regarding public opinion of a NJ Bubble –
I think the rate of traffic increase/decrease to this site should be a good indicator of public opinion.
I say this, ‘cuz njrereport.com is the first search result on google for “nj housing bubble”
JB, I know you mentioned traffic in Dec was about 20,000 (not positive).. how is the traffic trend looking?
ofcourse, this is just my theory ;-)
Can I get post from people who are interested in coming to NJ RE Networking Event.
Also do post which Day of the Week will work better.
I was thinking somewhere accessible from train station and at 6 PM on weekday will work better. That way all of us can come straight from work, have few Beers/Drinks & enjoy nice food.
I am a Non-Saver.
Whoooo-What a relief to get that off my chest, I mean you guys all know that other thing about me ( realtor )but this, well this was hard to confess. I am a wannabee however!
I’m gonna start tommorow, really.
KL
Alright one more thing.
I bought a flat screen TV for the Super Bowl, so tommorow I am definitly gonna start tommorow.
KL
>If it makes anyone feel better, my personal savings rate is at an all time high:)
you can having good savings and no debt. it’s hard but not impossible. if you saved too much the last 5 years you’ve been had by the fed.
bergenbubbleburst: She went to the council meeting you spoke of. She told me quote: “The people in this town are stupid”
SG
I am interested, of course you know I work Sundays btwn 1-4 (-:
KL
December Pending Home Sales down 4.4%(Adjusted)/7.6%(Unadjusted) on a year over year basis.
December Pending Home Sales – XLS
Adjusted sales for the Northeast, while down 4.8%(Adj.)/7.3%(Unadj.) YOY, made a surprising 8.1% jump since last month.
jb
Oh, and I looked at that ranch that was on the corner of 5th and Howland for $375,000. It was very “1960’s modern” inside, and had a very odd floor plan. There is also an MG in the basement. (yes, the car..)
JB,
I send you my Bergen data at the end of the day (C.O.B.).
Rich
#49 – It’s funny how many people are buying mega-screen HDs to see grown men groping each other.
I still have a 27 inch tube that I actually gave to my gf as a birthday gift way back in college. I never had a tv so when I took her as my wife, I got the tv back ;-) good deal :)
I went shopping for a ‘nicer’ tv – but all I really want is about 30ish inch – and there was none. All people seemed to care was the dimension.. what I need is a small 1080p tv – and there was none.
Anyhow, Clark Howard claims a $1000 tv today will be $500 by Christmas this year… and I believe him
Richard, you’d love it if I’ve been had. But my enormous savings is a result of 2 years of savings, not 5. So only when interest rates started to jump did I really buckle down and save.
And it’s not that difficult for many of us – I find it very very easy.
SG I would be down for that, I work night so need to know when in advance
Rent Lord, the tv thing is true…our friend bought a plasma for about 3Gs last year and we saw it at the WalMart this weekend for under 2Gs. Plasma is fighting a losing battle with LCD right now. It’s sure to have an effect on other tv technology.
Thanks Rich
Can I get post from people who are interested in coming to NJ RE Networking Event.
I’m assuming that it’s mandatory that I attend.
jb
I will only go if BOOOYA BOB goes!!
That http://www.housemath.us is a good site, thanks for the link.
JB #53 An 8.1% jump from December to January, or November to December, (maybe i need another cup of coffee) Any thoughts on your part either way?
Rent Lord#46 I would not be too concerned about Dec (20,000) it is s tought month, year end at work, the holidays etc.
thatbigwindow #54 Your Mom is right, stupid and getting stupider. Who votes to do a massive addtion to the elementary schools, without knowing how much the operating budget is going to increase?
Scary and sad.
NJ RE Network
rhymingrealtor & R Patrick signed up so far.
JB: You have to be in.
Come on guys, please post on the board if you can make it. It would be fun.
BOOOYA BOB – Lot of folks waiting for your word.
I focus primarily on the unadjusted year over year numbers. Which are as follows:
U.S.
Dec ’05 – 76.8
Dec ’06 – 71.0 (Down 7.6%)
NE
Dec ’05 – 57.6
Dec ’06 – 53.4 (Down 7.3%)
MW
Dec ’05 – 65.9
Dec ’06 – 60.8 (Down 7.7%)
S
Dec ’05 – 91.6
Dec ’06 – 84.9 (Down 7.3%)
W
Dec ’05 – 80.0
Dec ’06 – 73.6 (Down 8%)
If BOTH Booyaa AND Waaaaa go, this is gonna get interesting.
JB: For you it is mandatory.
IMO: Starting blog and making it great success, that has to be celebrated.
bergenbubbleburst,
November to December
My thoughts are lower prices and higher temps is the reason for the uptick. Mostly lower prices.
IMHO,
Rich
3 days to cover xhb,,, nothing
Keep in mind that the PHS dataset is based on a survey with a significantly smaller scope than the EHS data.
jb
Same goes for January
SG:
I work for a really anal wall street firm. Access to http://www.meeting.com is blocked. Will try to do this from home later.
My wife thinks that this blog is a cult.
Are we gonna have any rituals?
#71 Thanks Rich.
Where is BOOYA?
JB,
Did you get that report that I sent last week???
I am not a TV person, I gave in after much cajoling from my husband and 2 boys all three are huge sports fans, my oldest son is a Chicago bear fan since he was 7 and they are paying him back for his loyalty this year (he’s 15).
When My husband and I started dating I had a 19 inch that did’nt work, I could’nt care less, but once I was besieged by the men in my life I went on a mission to try to get a decent size and price and I chose LCD as from what I had read it was a little more durable, not so fragile. I ended up with a 37 inch toshiba that I paid 799.00- no delivery it was ordered on line and picked up in five minutes during a sears.com 3hr sale.
I was suprised however to find I needed a different cable box for more mula a month!
For the channels that are broadcast in HD it is incredible, but a crt is also incredible when hooked up to the hdcable box. CRT’s however are no longer being made bigger than 32 inch and they are extremely heavy and bulky.
The most incredible thing about it is how light it is, because while it was my husband and children who wanted it, it was Mom who was hooking everything up. A light TV made that so much easier.
KL
2006 personal savings drop to 74-yr. low
why would anyone save when the fed has clearly disincentivized the practice? the credit looseness continues to devalue the dollar and that 5% you get in the bank doesn’t even keep up. people should leave almost nothing in the bank and invest it all in liquid assets. a well diversified approach should handily beat savings rate.
A Lard convention :)
why would anyone save when the fed has clearly disincentivized the practice? the credit looseness continues to devalue the dollar and that 5% you get in the bank doesn’t even keep up. people should leave almost nothing in the bank and invest it all in liquid assets. a well diversified approach should handily beat savings rate.
How about 18% in the mutual fund – does this sounds better that 5% on the bank?? I guess it is not tax free… so more like 12% after all…..
And I thought that investments are considered savings???
Hey how about Dow 20000 by year 2008???
KL,
All my 4yo wants to watch is Power Rangers – and getting a big screen would just take the sanity out of my house!
“people should leave almost nothing in the bank and invest it all in liquid assets. a well diversified approach should handily beat savings rate.”
Examples?
BC,
Yes I did. Had mixed feelings. I think the most important wildcard is going to be competition with the resale market. As long as builders have a good bit of margin, they can easily outcompete the resale market in the South and any other rapidly growing markets. Don’t discount a potential shift to lower-cost housing or active retirement.
jb
njgal, why would i love it if you’ve been had? i don’t wish ill of people unlike some on this board wish ‘bagholders’ would get taken to the cleaners for having the audacity to ignore the data and bought recently or today. my point is the purchasing power of the dollar has been getting weaker due to a variety of factors. staying in cash even at 5% has been a losing proprosition. now that might change if credit contracts, deflation, etc. but i’ll wait to see what happens as the market continues to do well.
in terms of difficulty saving, depends on your individual circumstance. do you have kids? do you have two incomes? special needs? etc. etc. it’s all relative but most people i know renters and homeowners find it tougher to save then in years past.
>>Examples?
get yourself some fixed income bond funds paying 5-5.5% tax free. you’ll do a bit better with little downside on principal. or get yourself some high dividend shares. i recently picked up ADO and that pays 10%+. sure the share prices move a little this way and that but the goal is dividends not share price appreciation so they try to keep it stable.
there are tons of opportunities paying more than 5% taxable interest income.
more on TVs and super bowl:
http://news.yahoo.com/s/ap/20070201/ap_on_hi_te/super_bowl_super_tvs
sorry to digress!
From MarketWatch:
U.S. mortgage rates rise
Mortgage rates moved higher this week, according to Freddie Mac’s weekly survey released on Thursday, with the 30-year and 15-year fixed-rate mortgages reaching their highest levels in more than three months.
…
The 30-year fixed-rate mortgage averaged 6.34% for the week ending Feb. 1, up from last week’s 6.25% average. The mortgage’s average rate has not been higher since Oct. 26, when it averaged 6.40%. It averaged 6.23% a year ago.
The 15-year fixed-rate mortgage averaged 6.06% for the week, up from last week’s 5.98% average. The mortgage also hasn’t been higher since Oct. 26, when it averaged 6.10%. A year ago, the mortgage averaged 5.81%.
Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 6.04% for the week, up from last week’s 6.00% average. The hybrid averaged 5.87% a year ago.
One-year Treasury-indexed ARMs averaged 5.54% for the week, up from last week’s 5.49% average. The ARM is at its highest since Nov. 9, when it averaged 5.55%. It averaged 5.33% year ago.
How about 18% in the mutual fund – does this sounds better that 5% on the bank?? I guess it is not tax free… so more like 12% after all….
It’s important to draw the distinction between saving and investing. Investing implies a longer time horizon, which should allow a higher tolerance for risk.
I have money in mutual funds doing quite well, but I would never put my house down payment money (which I plan to use in the next 1-2 years) in a mutual fund. It’s just way too risky.
It’s true though. We have a system that strongly discourages savings.
First the govt. taxes my income, then I put it into Tbills at 5.15% interest, barley outpacing inflation, then the govt. taxes my paltry interest.
$1.00 Gross income
($0.25) fed income tax
$0.75 into Tbills at 5%
$0.04 1 year’s interest
($0.01) Uncle Sam’s cut
$0.77 What is left after saving my $1.00 for a year
($0.02) Impact of inflation
$0.75 What I’m really left with after a year of saving
Meanwhile, if I take out a suicide loan to rent a house from the bank, I’m getting all kinds of tax breaks.
thatbigwindow: When you were out looking,tdid you see this mls listing in RE 2701382, it is a new listing number I am guessing.
It originally came on late last Spring, early summer, for 619K, it had repeated price deductions down to 519K, when it was pulled late last year.
it is now back on the market at 499K (yellow colonial on Elm) I do not fell like calling the listing agent etc. Thought you might have some information. Taxes, features etc. Thanks in advance.
bergenbubble: that house first come on the market on 07/05
OLP was 579k before listing expired it was reduced to 559k
then relisted again at 549k, and now listed at 499k
taxes are 9,500/yr. has basebiard gas heat, built between 1900-1939. finished basement, lot size is 50X173X52X153
Is it a no brainer or lobotomy?
“It’s almost a no-brainer,” Walters said.
“Anyone who took an ARM in the last three, four or five years won big. Not only did they save a tremendous amount of money by taking advantage of when the Federal Reserve went down to 1 percent (on short-term interest rates), they’re also able now to exit those ARMs into historically low long-term rates.”
http://www.foxnews.com/story/0,2933,248981,00.html
I can’t believe that Paulson actually said this. It’s no secret that they have secretly promoted a lower dollar. However, they always talk up the dollar. Is this just throwing the dollar under the bus???
“U.S. Treasury Secretary Henry Paulson told the Senate Banking Committee on Wednesday he believed it would be very helpful for China to diversify their investment policies as it relates to reserves.”
http://today.reuters.com/news/articleinvesting.aspx?type=bondsNews&storyID=2007-01-31T160320Z_01_WAT006887_RTRIDST_0_USA-CHINA-PAULSON-RESERVES-URGENT.XML
JB,
I thought the same. I am hunting for a report from them regarding existing home sales.
Ford January sales tumbled 19 percent from a year earlier, Reuters reports. More soon.
Again, for those blessed with access:
gsmls: 2363105 (in readington?) DOM, street address?
BTW,
I love to see/meet all the crowd from here!
and finally for the financial folks– a simple (probably stupid) question: where is the best place to buy actual gold ie krugerrands?
thanks (as usual) in advance…
sl
duh… *I’d* love… etc, etc.
sorry, just got home from a night shift.
sl
” Profitability at U.S. companies is shrinking as wages rise at the fastest pace in six years. That may make stock gains harder to come by, if history is any guide.”
“Profit margins, or earnings as a percentage of sales, reached a record in 2006 after rising in 18 straight quarters. That helped propel a four-year bull market and sent the Standard & Poor’s 500 Index to a six-year high.”
“Ablin, Harris Private Bank’s chief investment officer, says that a jump in labor costs suggests margins may have peaked. Hourly earnings climbed 4.2 percent in each of the last two months of 2006, from a year earlier, the government’s monthly employment report showed. The advances were the biggest since February 2001.”
“Which way are margins heading? Unfortunately lower,” Harris’s Ablin wrote in a report last month. “We’re already witnessing strains on profits.”
“To be sure, the last time margins shrank coincided with the bursting of the Internet bubble and the end of a five-year bull market, which helps explain why shares fell so much from 2000- 2002. The U.S. economy’s slide into recession and the Sept. 11 attacks also contributed to the decline.”
http://www.bloomberg.com/apps/news?pid=20601109&sid=axpYPdpWIrf0&refer=home
“Fiscally fit” column in today’s WSJ. Writer is going through a property tax re-assessment in Edison. Also, some interesting comments were posted on her blog. (subscription required).
Cut? Cut? Hike!
As State Lawmakers Mull Property-Tax Cuts,
The Cullens Brace for a Home Reassessment
February 1, 2007
http://online.wsj.com/article/SB117025688474593716.html?mod=hps_us_inside_today
If a listing was in status of A* and the expiration date of the listing passes, does it automatically go to X status in the GSMLS?
>>I have money in mutual funds doing quite well, but I would never put my house down payment money (which I plan to use in the next 1-2 years) in a mutual fund. It’s just way too risky.
there are investment vehicles with that time horizon that can do better than 5% taxed. if you have $100k for a downpayment an extra couple of thousand would surely help.
“$1.00 Gross income
($0.25) fed income tax
$0.75 into Tbills at 5%
$0.04 1 year’s interest
($0.01) Uncle Sam’s cut
$0.77 What is left after saving my $1.00 for a year
($0.02) Impact of inflation
$0.75 What I’m really left with after a year of saving”
If you consider income getting dunned for FICA (14% since the employer pays their 7+% pretty much out of your pocket) and state taxes, the picture is even bleaker.
Savings comes naturally to me, so the disincentive to save doesn’t bother me.
thatbigwindow #94 July of 05? Wow the time is flying. But thanks for the update. Taxes of $9,500! Boy that is ugly. It looks like a decent house, but those taxes are insane. They will be close to 11K after this years tax increase.
I think it will have to come down a lot more to attract a buyer, even in Ridgewood, I mean River Edge (we think we are the next Ridgewood)
I would almost be tempted to throw a low ball offer, but with those taxes why bother, they will probably be 12k to 13k or mroe once all the new class rooms are up and running. Oh well.
It is almost a no-brainer Mr. Walters for those who have equity. If you purchased in the last 3 years or so with little or no money down, there is a good chance may be no equity, therefore no ability to refi to a fixed rate.
http://photos1.blogger.com/x/blogger/6511/1295/1600/938771/Weve%20Reached%20the%20Bottom.jpg
Still Looking
gsmls: 2363105 (in readington?) DOM, street address?
53 Pleasant run rd
listed 1/12/2007
Listed 10/11/2006 expired 1/11/2007
Thats all the history I could find
KL
“Anyone who took an ARM in the last three, four or five years won big. … they’re also able now to exit those ARMs into historically low long-term rates.”
Let’s be realistic here. Most of the people who took ARMs over the last few years did so out of necessity or as a means of stretching their affordability to the max.
Say you took out an ARM in Jan. 2004 for $500k at 3.5%. Your monthly payment would have be $2,245 for the first year. After 2 years you pay off $20k in principle and now owe $480K. You refinance the $480k into a 30 year fixed at 6.25%. Your monthly payment just went up by $710 per month and the 30 year clock starts all over again.
Yea, big winner.
dreamtheaterr Says:
February 1st, 2007 at 11:38 am
dream/index:
results from a client account with inherited positions
IYY-ISHARES TR DJ TOTAL MKT US TOTAL MARKET INDEX
Buy 07/20/2000 $70.1875
Today 02/01/07 at 2:20PM $70.260
the SOB went into the black on a NOMINAL basis after 6 1/2 years
Wake from your dream!
“Adjusted sales for the Northeast, while down 4.8%(Adj.)/7.3%(Unadj.) YOY”
Does anyone understand how YOY numbers can be “seasonally adjusted” ? It’s totally illogical.
I’ll come to the networking event as long as there is security.
RentLord, if you’re going for a 30″ panel, you don’t need 1080p. At that size your eyes can’t distinguish between 720p and 1080p.
Clot,
All that glitters in the hills of Somerset is not limited to RE.
Okay, If I live long enough to experience the next RE Bubble, this is what I am doing:
When the short term rates are 1% I will take out an ARM and buy a house. Then I will rent it for 1 to 2 years and sell it for a massive profit.
I am a financial jeanyous!
Clotpoll Says:
February 1st, 2007 at 2:36 pm
I’ll come to the networking event as long as there is security.
lol where is the trust???
I guess you expect to see a lot of very angry and upset people??
You might be surprised. Blogging is the way to vent for many people…
BC Bob Says:
February 1st, 2007 at 2:44 pm
All that glitters in the hills of Somerset is not limited to RE.
I miss the old Plucky :(
new record on dow… xhb continues
hurry to your local home buying store.
savings at 74 yr low.
however, cars are on sale.
Hey, Clot
Seneca was describing real estate agents who pack mace and bring their burly husbands with them when they show a house.
Maybe you could round up a few of those? :)
Hi All,
NJ RE Report Network Event
I have created an online EVITE for the Networking event. Click the following link and signup, so we know how many people will come.
http://www.evite.com/app/publicUrl/skgala@yahoo.com/njrereport
At present, I just picked date of February 20th at 6:30 PM. We can change date if necessary. Also we would need to pick restaurant for the network.
I would imagine lot of discussion not only on RE but many other things as well. Also, if anyone has any suggestions for things to do, please shoot them in the Comments field on Invite.
More on negative savings;
“Savings At Lowest Rate Since Depression
Americans Spent Everything They Made Last Year — And Then Some”
“Sooner or later, we think, the increases in value of the stock market and homes will not be great enough to reassure most Americans that they have enough savings, but right now, it hasn’t stopped,” he said. “It explains the continued strength of the economy.”
http://www.cbsnews.com/stories/2007/02/01/business/main2422489.shtml
ChiFi-
The Plucky? OMG! I didn’t have you figured as the “head down on the bar” type.
Have you been there since it became the Pluckemin Inn?
$42 entrees with things like wasabi ice cream and seaweed cappuccino. Barf.
SG (121)-
May I suggest the sacrifice of a chicken or goat at the networking event?
Scribe (120)-
It’s so impolite to show up with muscle. Not my style.
Al (117)-
Assault is the way to vent for many people, too.
This has got to be the ultimate conservative statement by the FED meeting:
“Some tentative signs of stabilization have appeared in the housing market.”
could anyone be more carefull with their words than the fed?
cs (127)-
At least, unlike Greenspan, it’s plain English.
NJMLS 2634784 Ridgewood
Sold 11/01 – $539,000
Sold 09/04 – $800,000
Currently For Sale $788,000
Seller will incur approx. $60,000 loss after commission & transaction costs if sells at listing price, and if no repairs are necessary.
Clot, you have my security ;-)
I only take 3% of your annual income for security.. but for you.. i’ll make it 1.5%
Interesting data out of NY, from Inman:
New York home sales, prices fall by double digits
Although the decline in existing-home sales and prices across New York state deepened in December, sales for the year posted their third-highest level on record, according to preliminary data accumulated by the New York State Association of Realtors.
There were 7,462 existing single-family home sales recorded in December, down 19.2 percent from the 9,238 sales in December 2005. The statewide median home price lost 14.2 percent during that period, falling from $265,000 to $227,500.
The steepest declines in sales for December occurred in Long Island where Nassau County’s 559 sales represented a 38.6 percent decrease from 910 sales a year earlier and Suffolk County’s sales tumbled 41 percent to 674.
…
The 2006 statewide annual median selling price of $248,500 represents a 2.8 percent decrease from the 2005 statewide median of $255,675. This is the third time the annual median has surpassed the $200,000-mark since NYSAR began tracking data in the 1980s.
I went shopping for a ‘nicer’ tv – but all I really want is about 30ish inch – and there was none. All people seemed to care was the dimension.. what I need is a small 1080p tv – and there was none.
Rentlord,
I agree. 1080p is unnecessary for a 30 inch TV. That’s probably why you can’t find one. We just picked up a 42” plasma HDTV (720p) and the picture in HD mode is incredible. It’s also not so big that you get unbearable image distortion in standard definition TV mode.
We picked it up on Black Friday (Friday before Thanksgiving) for $1,100 at Circuit City. I know I got a good deal because Circuit City took a hit on their holiday earnings from the HDTV TV price wars this season.
pesche,
Yesterday; [goog,earnings], “rising tide lifts all boats”. Were you referring to row boats and not “the” luxury yacht???
If you got any 42inch 1080p for
Wow. That IS big. Wonder which counties had the highest % price drops.
Jeremy Siegel: Interest Rates Look Stable, but Beware the China Bubble
Published: January 24, 2007 in Knowledge@Wharton
Knowledge@Wharton: Since you raised the point of the housing market, is it bouncing back? You expressed surprise in your recent newsletter about the fact that it came in at 1.64 million units, which I guess was 120,000 units more than the previous month.
Siegel: Right, it was a surprise. It was concentrated in multi-family construction mostly, which is five units or more, rental units as well as condominiums. Actually, single family home starts were down. But nonetheless we’ve had two months now of increase. It’s not like anything we had last year. But it suggests that we’re not falling off the biggest cliff in the world — that there might be a bottom soon.
But I don’t think that we’re going to see any — housing is certainly not going to add anything to GDP. It’s a question of whether it’s going to subtract any more than it already has. It has been subtracting, most economists estimate between 1 and 1.5 percentage points from GDP growth. My feeling is that the lower oil prices have been basically adding that back to keep us on a 3% growth.
We’re going to get that growth next January 31st and most estimates that I’m seeing out there are between 3 and 3.5%, which is actually at or even slightly above the average for the last two years. This is pretty surprising again during this housing decline, but not so surprising because we’ve had a concurrent oil price decline and energy price decline.
And, again it’s not just gasoline; it is even more importantly heating oil, natural gas and those derivatives that can be very expensive for people in the winter months.
http://knowledge.wharton.upenn.edu/article.cfm?articleid=1648
if you got any 42 inch 1080p for less than $1100 i think it’s a steal right now… but just like RE, give it a coupla months and it will seem overpriced ;-)
[trying my msg again]
the SOB went into the black on a NOMINAL basis after 6 1/2 years
Wake from your dream!
Chifi, as I have mentioned every time, one needs to diversify globally (the US only accounts for half the world stock anyway). So instead of cherry picking a large cap US fund in 2000 and seeing what it is today, how about posting results for a World fund from 2000 till today.
The MSCI World Index has returned on average 11.31% the past five years year ending December 2006. I don’t suffer from US bias in my portfolio allocations.
PS – please read my last comment to you from the other thread, so that this does not turn into an index/active debate. There are many roads to Dublin – I just choose mine with as little intermediary costs as possible.
I think we’re gonna need masks and black capes for the cult gathering.
Hot off the presses:
How to buy an HDTV
From Fortune Magazine
http://money.cnn.com/2007/01/31/technology/HDTV_guide.fortune/index.htm?cnn=yes
The Cult Gathering need Mortals to Join the Ritual !!!
Sign up for the gathering at,
http://www.evite.com/app/publicUrl/skgala@yahoo.com/njrereport
May be we all can get MLS listing from folks living in Dreamland of 2005 and burn them. Ha Ha Ha !!!
Questions about the gathering;
1)Is it true that only those with MLS access know the address of the gathering???
2)Is the establishment offering rebates??
3)Does the bar have granite countertops???
$1000 Superbowl HDTVs?!?
What happened to fiscal responsibility and attempting to maximize savings?
If you are going to blow the budget, at least do it at http://www.anticost.com
jb
#140.. we also need a fire going
anybody with voodoo skills?
The Kid: “I’m here for the The League of Dorks gathering?”
Hostess: “What?”
The Kid: “I’m sorry. Is this the location of the New Jersey Real Estate Report blog
gathering?”
Hostess: “A blog gathering?”
The Kid: “I must have the wrong place. Is there a party for Grim?”
Hostess: “Weirdo” and walks away
JB,
The Bergen data is in you mail box.
Smoooooooth…
If you are going to blow the budget, at least do it at http://www.anticost.com
Rich
The Kid – We will start off with an Initiation ceremony for you since you are taking the RE classes.
LOD (minus agents) on one side, Agents on the other.. you and fire in the middle.
Can you dance?
Somebody educate me, what’s LOD?
League of Dorks.
Rich,
The jump in Bergen County contract-sales in January is surprising.
Hopefully we’ll see data on the rest of the North Jersey counties later in the week.
I’ll post your data up along with the GSMLS data once I compile.
jb
I was guessing League of Doom…
If we’re going to get together, can I recommend:
Latest dining deal in city of $13.95 buffets: $1,000 desserts
For $1,000 in Monopoly money, you can buy Boardwalk and Park Place and still have $250 left over. In the real Atlantic City, here’s what $1,000 will get you these days: dessert.
And that’s not even counting the tip.
Hyper-expensive desserts are the latest way increasingly upscale Atlantic City has found to separate casino winners from their winnings.
…
At Brulee, the dessert is a brownie with hazelnuts imported from Italy, topped with gold dust, served with a vintage port wine in a $750 Baccarat crystal that the dessert-eater gets to keep as a souvenir. Like the other offerings at the restaurant, it’s served along with two other courses of dessert.
“Here’s the idea,” pastry chef Jemal Edwards told The Press of Atlantic City for Thursday’s newspapers. “You have this beautiful atomizer filled with the finest port known to man. You take a bite of the brownie, and as the flavors are coating your palate, your partner squirts the port onto your tongue. The acidity and sweetness from the port are hitting your mouth at the same time.”
Senate votes to raise minimum wage.
Grim (153)-
Why don’t they just provide a hooker as dessert & let them strip down and go at it?
The $1,000 dessert is for sure one of the signs of the Apocalypse. I’ll be you can find it in Revelations.
Just for sh__s and giggles, how bad can this crash really be?
and
What would be the best possible out come…?
I am sitting here and can’t picture senior citizens at the curb huddle up over a fire barrel to keep warm or massive civil unrest…
Really, how bad can it possible get?
-Sapiens
The $1,000 dessert is for sure one of the signs of the Apocalypse. I’ll be you can find it in Revelations.
Doesn’t the fact that you get the crystal really make the desert itself only worth $250?
Surely, that must keep the horsemen at bay for a short while..
jb
Re: savings
Tax policy greatly encourages investing in RE to the expense of saving by traditional means. Americans’ recognition of this is arguably pretty smart.
First, interest income is taxed at ordinary rates, whereas for most people there is no double taxation for appreciation of your primary residence.
Second, to the extent that most people borrow to purchase and improve their homes, they convert ordinary income into tax free income, due to the 100% deductibility of mortgage interest.
dreamtheaterr Says:
February 1st, 2007 at 4:27 pm
So instead of cherry picking a large cap US fund in 2000 and seeing what it is today, how about posting results for a World fund from 2000 till today.
dream: cherry pick? are you crazy? it is the Wilshire 5000 index! I’m taking YOUR road to Dublin! and by the way, mine goes through Scotland ;-)
dream: what world index fund was available in the year 2000?
“I am sitting here and can’t picture senior citizens at the curb huddle up over a fire barrel to keep warm or massive civil unrest…”
yes, this will never happen because senior citizens control washington.
more likely, the younger generations will end up paying 75% income tax to fund lavish entitlement programs
I am sitting here and can’t picture senior citizens at the curb huddle up over a fire barrel to keep warm or massive civil unrest…
Really, how bad can it possible get?
Nor can I. I’m not going to bet against the American economy just yet. We weathered prior real estate downturns with few problems. If you are looking for comparison, look to the mid-90s, and not the Great Depression. Prices fell, people took some losses, the sun still came up. Heck, some of those folks are here now.
I’m not sure where the bunker-dweller viewpoint really came from. Does anyone here really think that way, or is it just a bull stereotype?
jb
dream/index:
go check out most global index funds right now…..they are roughly 40% energy and financial stocks…..if that isn’t a mistake, I don’t know what is…..
Off topic, advice needed…
Six months ago, our manager approached the owner of the business next door about subletting his space. There was a rumor that this person was unhappy and wanted to get out of the business.
Two weeks after the conversation, the business is listed for sale for a ridiculous amount by a local realtor. The price is way too high for a retail business with no foot traffic and little revenue.
Our business originally occupied the space. We gave it up to move into a bigger space next door. Now we would like both spaces.
Other than the realtor’s web site and the local MLS, the realtor has done nothing to sell the property. There have been no newspaper ads. Our landlord has told us that there have been no calls by interested parties on his end.
We are not interested in his business. We would like his space. As a good faith measure, we could purchase his inventory and get rid of it or just write it off. We have no interest in operating his retail business.
Since our manager approached him before it was listed, should we engage the realtor? Should we wait for the listing to expire? Since we are not buying the business, should he get the broker to let him out of his contract?
What do you think?
“I am sitting here and can’t picture senior citizens at the curb huddle up over a fire barrel to keep warm or massive civil unrest…”
Neither can I. but I think it is possible that the unemployment could spike drastically resulting in many people loosing their jobs, homes, cars, credit scores, and face financial difficulty.
cf,
Thanks for reminding me about some of my late 90’s plays..
SGP
MRK
PFE
jb
http://www.safehaven.com/article-6790.htm
“Neither can I. but I think it is possible that the unemployment could spike drastically resulting in many people loosing their jobs, homes, cars, credit scores, and face financial difficulty. ”
Pharma and booze companies stocks should do well…
LOL
and NJ Govt jobs. The booze and pharma will te taxed at 100% to support NJ govt jobs.
dreamtheaterr Says:
February 1st, 2007 at 4:27 pm
I don’t suffer from US bias in my portfolio allocations.
errr…”suffer” is a harsh word…..I think this country’s financial markets speak for themselves…..
At a minimum, blame will be placed in a similar manner as in the past:
http://us.history.wisc.edu/hist102/lectures/lecture18.html
Interesting…those three “B’s” at the bottom of the page.
What’s Ben’s middle name?
KL,
Thank you!! (I just woke up — sorry for the late thank you!)
sl
This is off topic, but some may remember my post a couple of days ago about a unit it my townhome development that is on the market with no sign. Well, it turns out it is a short sale (though I still don’t think that explains the lack of a sign). My husband I went to look at it tonight. We were curious because the price dropped from $349k to $315k. We are thinking about putting in a lowball offer, just to see if we could get the seller (and the bank holding their mortgage) to bite. A small 2-bedroom unit in the development recently went for $285k and a larger 2-bedroom is listed at $315k right now. This place is a 3-bedroom.
Anyway, I think this is further evidence of the kind of situation that many FBs will find themselves in soon.
AK
“Take Lloyd Blankfein. The Goldman Sachs man took the wheel at the firm after Hank Paulsen went on to greater glory at the Treasury Department. In the six months from the time he took the job until the end of the year, he is reported to have earned $53.4 million. Let’s see, that is about $9 million per month…nearly $2 million per week…or about $400,000 every working day.”
Talk about having a bad day at the office !
subprime news –
http://bakersfieldbubble.blogspot.com/2007/02/mcaa.html
Looks like MCAA is gone.
dream: cherry pick? are you crazy? it is the Wilshire 5000 index! I’m taking YOUR road to Dublin! and by the way, mine goes through Scotland ;-)
dream: what world index fund was available in the year 2000?
Chifi, why look at the Wilshire 5000 in isolation? It seems to be falling on deaf ears I don’t care about the US market return in isolation.
Since you have access to data, see what a combination of approx 50% US Total Stock Market, 35% EAFE Index, and 15% Emerging Markets returned from 2000 till date? (Vanguard offers them all through a US Total Stock Market, Europe, Pacific and Emerging Markets Index). I don’t have a world index fund; having it separate allows me to rebalance and also avail of the foreign tax credit.
go check out most global index funds right now…..they are roughly 40% energy and financial stocks…..if that isn’t a mistake, I don’t know what is…..
I just accept what the market cap in each continent offers me. Let the market participants decide the sector weightings and what’s over/undervalued.
errr…”suffer” is a harsh word…..I think this country’s financial markets speak for themselves…..
I think you misinterpreted, or I didn’t make myself clear. I meant I don’t have a US-heavy portfolio, i.e. a portfolio with 90-100% US stocks only and nothing overseas.
“I am sitting here and can’t picture senior citizens at the curb huddle up over a fire barrel to keep warm or massive civil unrest…”
I can imagin a lot worse than that. Imagine yourself a twenty-something looking at hundreds of thousands in tax obligations. The apparent unfairness of it may lead to frustration and anger. Anger can lead anywhere. Remeber to movie ‘Soylent Green’?
Charleton Heston eating people made into holy wafers?
dreamtheaterr Says:
February 1st, 2007 at 8:26 pm
Since you have access to data, see what a combination of approx 50% US Total Stock Market, 35% EAFE Index, and 15% Emerging Markets returned from 2000 till date?
dream/index: is this your form of an IQ test? what is wrong with this picture?
Fixed Income investing……..Jersey-style…..http://www.bloomberg.com/apps/news?pid=20601109&sid=aMOQTfoOlkak&refer=home
Moon joked about the group’s nickname and their code of silence. “We would absolutely not admit to being in the REIT bond mafia,” he said. “We are in the waste disposal business.”
20 Gang Members Arrested in New Jersey Raids
http://www.nytimes.com/2007/02/01/nyregion/01cnd-bust.html
Staging a series of raids that spanned from the northern suburbs of Philadelphia to the Jersey shore, the police said today that they had arrested 20 members of a street gang that is accused of widespread drug dealing and gun violence in Trenton and central New Jersey.
“I am sitting here and can’t picture senior citizens at the curb huddle up over a fire barrel to keep warm or massive civil unrest…”
This is different debate for another day. We don’t have to worry about this scenario for awhile. That being said, when gold finally exhibits a blow off top, maybe 4-7 years at 2,000-3,000 oz., then the hard times come. The same propellent that diffuses gold will utlimately lead us/world into a deep,deep resession. Worse??? At that point we will be at a fork in the road. Either, implement serious structural changes,[dollar,deficits,ss,medicare,etc..] with harsh implications, start a war, or just pass the problem down to the next generation.
Again, a different debate for another day.
Check out this listing — relisted by Weichert three times, and ten months later, finally caught a fish:
2 Clive Hills Rd, Short Hills NJ
Apr 18, 2006 – $988,000 (MLS 2268017) Weichert
May 03, 2006 – $949,000
Jun 15, 2006 – WITHDRAWN
Jun 16, 2006 – $948,000 (MLS 2290076) Weichert
Jul 24, 2006 – WITHDRAWN
Aug 16, 2006 – $924,000 (MLS 2310260) Weichert
Sep 07, 2006 – $899,000
Nov 30, 2006 – $849,000
Jan 02, 2007 – Attorney Review
Jan 05, 2007 – Back on Market
Jan 14, 2007 – Attorney Review
Jan 19, 2007 – Back on Market
Feb 01, 2007 – Under Contract
“Personal Savings Rate for 2006 Tumbles to Negative 1 Percent, the Lowest Level in 74 Years”
This is a serious issue. I don’t understand why the press isn’t giving more attention. Forget GOOG.
SAS
BC Bob Says:
February 1st, 2007 at 9:43 pm
That being said, when gold finally exhibits a blow off top, maybe 4-7 years at 2,000-3,000 oz., then the hard times come.
Dude – are the f—- grim reaper?
any of you cats going to NJRE blog social?
SAS
Check out this one Unrealtor
237 Belvidere Washington TWP NJ ( Warren county)
Listed 112,000
Sold 113,000 9/2000
Listed 194,000
Sold 196,000 4/2005
Listed 233,000 9/2005
Witdrawn 233,000 11/05
Listed 229,000 11/05
Expired 209,000 8/06
Listed 1/27/2007 $179,000
Mls # 2368693
Jim,
How can we put something like this together, this is something you have to spot and follow, do you know of another way?
KL
SAS (187)-
If the momentum develops, I’m there. Registered as a “maybe” @ SG’s E-Vite.
Good idea on the Scotch and sticks. Both should be available in quantity to make this thing an A-list shindig.
Subprime Loan officers “concerned about future”
http://forum.brokeroutpost.com/loans/forum/2/90713.htm
With new lenders closing daily, and even the big giants trying to get out of the mortgage business, its getting very scary to think of the future….
Real estate is flat, now for a spring market to start booming, a huge amount of clients will be now eliminated from the home buying market.
A/E’s that made money before at sub prime lenders will not, because there won’t be any niche products to offer, basically if you have a sub prime borrower with 5 to 10 percent down, you will just shop rate and go with the smoothest going sub prime lender
I wonder if and when guidelines will every loosen up. I wonder when new players will come into the mortgage business. I just think eventually all of the CURRENT sub prime lenders will slowly disappear.
As Spring Home-Shopping Season Looms, Supply Mounts and Prices Fall in Some Areas; Builders See Slow Recovery
Amid a continuing glut of homes for sale in most of the country, buyers should have plenty of choices and lots of bargaining power in the spring selling season — typically the busiest time of the year.
Many builders and real-estate brokers, for their part, hope the housing market will start recovering this year as buyers respond to price cuts and other sweeteners offered by increasingly nervous sellers. In some markets, agents say, buyer traffic has picked up in the last month or two.
But any recovery is likely to be gradual. Donald Tomnitz, chief executive officer of D.R. Horton Inc., a home builder, told investors this week that the market, which began slumping in 2005, may bottom out by mid-2007, but that “we don’t see any rapid improvement thereafter.”
http://finance.yahoo.com/real-estate/article/102330/housing_glut_gives_buyers_upper_hand
“Dude – are the f—- grim reaper? ”
Chi,
LOL!!! If you think I’m nuts step up and sell the Dec 2007 1,000 gold calls. You can take in around $5. If this is ridiculous, go ahead and sell 100 calls. You can take in 50k. Free money, right???
By the way, approx 2,200 just gets us back to the real all time high.
Think about it, who in their right mind would have figured that Nasdaq 1997,1,200 would run up to 5000 in 2000. Then back to 1,100 in 02??
Who in their right mind would venture to guess that a 250k cape in 2001 wouild sell for 500k in 2005???
I can go on and on. Just think what will happen to the price of gold if China, who only holds 1% of their reserves in gold, decides to move towards 5 %???
Again, if its so damn ridiculous, step up and sell the s*it out of the Dec 1,000 gold calls.
BC Bob-
What do you think of buying deep-in-the-money gold calls on some of the better mining stocks (GG, AUY, AAUK, etc)?
What do you also think about “Texas hedging” them with the same deep-in-the-money plays on other metals (PCU, PD, RIO, NUE, ATI)?
Or, do you think I should cut off my fingers and throw my computer and phone away (so as to render myself unable to trade)?
Anything you can dig out of the ground or feed to a cow feels very, very right.