This is the time and place to post observations about your local areas, comments on news stories or the New Jersey housing market, open house reports, etc. If you have any questions you wanted to ask earlier in the week but never posted them up, let’s have them. Also a good place to post suggestions, requests for information, criticism, and praise.
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From MarketWatch:
U.S. agency rejects Fannie Mae’s request for larger loan portfolio
The Office of Federal Housing Enterprise Oversight said late Friday it would not allow Fannie Mae to increase its portfolio beyond the $727 billion limit created in May 2006, despite arguments by the company and senior Democrats that a change would provide much-needed stability to the shaky mortgage market.
The agency’s announcement comes after a tense week of public posturing in Washington. Several major mortgage companies have complained about difficulty selling loans to investors, and Fannie Mae said it could pump liquidity into this area.
From Bloomberg:
Goldman’s Global Alpha Falls 26% in 2007, People Say
Goldman Sachs Group Inc.’s $8 billion Global Alpha hedge fund has fallen 26 percent so far this year, a decline that may prompt more investors to withdraw their money, according to people familiar with the fund.
Goldman’s largest hedge fund, managed by Mark Carhart and Raymond Iwanowsk, has dropped almost 40 percent since July 31, 2006, said the people, who declined to be named because the fund is private. The Standard & Poor’s 500 Index of the biggest U.S. stocks has returned 16 percent during the same period.
“It’s hard to imagine how investors can maintain confidence, because their losses have been taking place over a long period of time, starting last year,” said Virginia Parker, who helps oversee about $1.8 billion at Parker Global Strategies LLC in Stamford, Connecticut. “There has been a broad range of market climates, and the fund has not demonstrated the ability to excel in any of them.”
RE: Goldman’s Global Alpha Falls 26%
Bear was first to make headlines, and suffer a media pile-on, but they certainly aren’t alone in the sea of mortgage madness.
It appears an illegal alien was responsible for the recent execution-style murders in a Newark schoolyard:
http://www.cnn.com/2007/US/08/10/schoolyard.killings/
Bail is set at $1M. The girl who survived is identifying everyone.
Mark Carhart looked out over the packed New York conference room and told investors that Warren Buffett had it all wrong.
http://www.iht.com/articles/2007/02/04/bloomberg/bxhedge.php
CNBC just said Beazer is delaying its 10-Q
There’s a chill in the air. Feels like Sept. and yet, many sellers have not reduced. I’m waiting to buy that shore house for $400K. Maybe I’m dreamin’…
CORRECTED-Beazer Audit Committee finds incorrect accounting
http://www.reuters.com/article/marketsNews/idUKWEN037220070810?rpc=44
Citigroup has $500 mln credit business loss – FT
How much will Citi go down on Monday?
http://today.reuters.com/news/articleinvesting.aspx?type=bondsNews&storyID=2007-08-10T234241Z_01_N10147895_RTRIDST_0_CITIGROUP-LOSSES.XML
#4,
This story makes me mad, how many dead bodies do we need to find before we get are act together and deport these criminals?
There’s an old saying on Wall Street: “The firm made money. The broker made money. Two out of three ain’t bad.”
From MarketWatch:
This week’s Real Estate stories
Leading off with “Oversized garages with two or more parking spaces are a must-have feature for many home buyers, even during times of elevated gasoline prices, according to a report released this week by the National Association of Realtors.”
Kinda funny.
Also,
“Six questions consumers are asking about how mortgage-market issues affect them”
“For some consumers, credit crunch ahead”
and more
Hate it break it to you illegal-bashers, but Newark isn’t the hellhole that it is because of illegals or even because of Hispanics. Our own homegrown scumbags are primarily responsible for the decay. Scapegoating illegals may feel nice and make good news, but it hardly addresses the real problem.
#13,
I hate to break it to you but who allegedly killed 3 people and left another badly wounded. He had a long wrap sheet and should have been deported to Peru many years ago.
Did you see what else this guy did with the 4 year old girl? Sick!!!
Frank,
Deport him and he can sneak back. Our borders are a joke.
That said, again, if you deport every illegal you won’t fix Newark. Most Bloods and Crips aren’t illegal immigrants. The illegal angle is just a distraction.
#15,
Illegals are committing crimes in every town, Newark is just one them. This horrific crime was not gang related.
Couple of points:
– This blog rocks … you guys saw this coming, so i sold my investment … you guys said ‘cash is king’ and we have our 20% and then some collecting 4.5% in ING … if only Bednar had told everyone about buying the euro! two out of three ain’t bad …
– I had long been against deporting illegals. Then, last week, i spoke with a close family member who recently retired from the world bank. i have now changed my tune. i think we have to kick them out, for the good of this country. and i can admit that i am a minority and my parents immigrated to this country in the 70s and all 8 of my mom’s brothers and sisters came here legally
– practicing patience daily as i watch all those 600k houses i’ve been looking at slowly drifting into my 400k price range (too bad Troll’s not around to eat his words)
– man i took a hit with apple. ouch. bought at 137 and it’s down to 125. majorly bummed. but im holding it long-term anyway. hopefully buying the new imac this weekend, but it’s a business need, not a want
“. Most Bloods and Crips aren’t illegal immigrants. ”
Yes but: the children of illegals who share little of their parents’ work ethic provide a limitless supply of new members.
Frank,
Those guys were clearly scumbags. He shouldn’t have had a rap sheet because he should have been deported after the time he was arrested. This guy should face the death penalty, but this is the PRNJ, so he won’t.
It’s an oversimplification, however, to blame crime in general in illegal immigrants. Sync is right. Most of our urban crime problems are home grown. Most people who are here illegally are simply looking for a better life. Most work their butts off for very little pay to take jobs American’s won’t do. I’m not defending illegal immigration, but to blame them for Newark’s blight is unfair.
Maybe we shouldn’t call them “illegals” or even “immigrants.” The dynamic seems more like Colonization.
You can not deport 12 million+ illegals without some draconian measures that this country is not prepared to deal with. Secondly, everyone focuses on the cost of the illegals as measured by crime and etc, but the brutal truth is there’s an economic benefit from them being here and that benefit outweighs their cost on society. If that weren’t so, then they wouldn’t be here. It’s their “illegal” status that results in their below market wages and if you really want to do something about the problem, then it will be necessary to deal with those who are gaining the most from their presence.
The simplistic solution of deporting them really does not get at the issue; it just makes everyone feel good. Same deal applies to the knuckleheads selling illegal drugs; feels good to arrest them, but this does not deal with the real issue of demand. The demand curve for low wages is the problem just like the demand for illegal drugs is the problem. I’ve not heard anyone propose a solution to curb the demand for either.
– I had long been against deporting illegals. Then, last week, i spoke with a close family member who recently retired from the world bank. i have now changed my tune. i think we have to kick them out, for the good of this country. and i can admit that i am a minority and my parents immigrated to this country in the 70s and all 8 of my mom’s brothers and sisters came here legally
“There’s an old saying on Wall Street: “The firm made money. The broker made money. Two out of three ain’t bad.”
There’s a new saying on Wall Street as the firm is gearing up for layoffs, Ben?
Did you ever wonder why the street was straddled by a river on one end and a cemetery on the other?
Bloodbath,
600K houses drifting into the 400K range? Are you sure you’re not looking in Florida?
“How did some of the smartest minds on Wall Street and at banks, insurance companies, pension funds and hedge funds around the world get into the current financial-market mess?”
“How did all this happen? As any good con man will tell you, the success of a con depends on the mark wanting to believe. The victim, in essence, talks himself into getting fleeced.”
http://articles.moneycentral.msn.com/Investing/JubaksJournal/HowWallStreetGotIntoThisMess.aspx?page=1
Reinvestor – I realize deporting 12 million people would be a major, major problem. And i realize that they will continue to return (or at least try).
But the long-term ramifications are even more dangerous. If this continues, by 2020, we’ll have what, 24 million illegals here? These people are a massive, massive drain on our health care and school systems and it will only get worse.
Plus, many (as evidenced by arrests) treat this country as if they don’t have to play by the rules because technically, all that will happen is that they will get booted. And their kids see this and many may end up behaving the same way. IN OUR PUBLIC SCHOOLS next to our children. That’s scary.
I’d say in most states, the police know where the illegals hang out to get those day jobs. Nationwide, I’d guess that would eliminate 2 million of them. We can start by rounding them up there and keep going. I’m sorry, but it really must be done.
As for the economic benefit, 50 years ago, there weren’t nearly as many illegals. Who did all these jobs? You guessed it – Americans. Initially, there will be some resistance to clean toilets, mow lawns, clean houses etc … but after a grace period, it should be fine.
Secondly, everyone focuses on the cost of the illegals as measured by crime and etc, but the brutal truth is there’s an economic benefit from them being here and that benefit outweighs their cost on society.
Can you show us the math?
Seriously. I constantly hear how illegals who make $7/hour contribute so much to the public coffers that they’ll single-handedly save social security.
What of our tax dollars get sucked up by illegals caught in the legal system – including the illegal component of the prison population? What of the several hundred hospitals in the SW that were bankrupted by illegals who couldn’t pay.
Speaking of which, have you spent any time in a NJ ER lately? I had to spend 21 hours in one because the staff was overwhelmed with non-english speaking patients mostly seeking routine care. Guess who pays for that?
Yes, corporations who employ illegals get a cost break. But that’s a privatized benefit. Meanwhile the rest of society must bear the costs.
So show us please how we as a society have a net benefit from the mass importation of poor and uneducated people. Be sure to show your work.
22 – It’s very, very early. Summer’s not over. Just wait.
http://www.nytimes.com/2007/08/01/business/01leonhardt.html?ex=1186891200&en=5c3d7cf7392c0741&ei=5070
In Oct/Nov, things will get very interesting. Just a guess, but lots of people with shady mortgages will be walking away from houses in Dec/Jan. I think there will be a little bounce in the Spring because houses you see on the market now will be selling for 100k less by Dec/Jan/Feb.
Just my guess. Some may disagree, but remember, when this month ends, the music stops. The school year has started and most people won’t want to uproot their kids from school … leaving the sellers really have two choices: take it off the market and give up on cashing out … or lower it to sell it.
Our political leaders have no backbone dealing w/this issue. If they talk tough, they’re labeled “xenophobes” and “racists” by Jessie “Hymietown” Jackson and Al “Tiwana Brawley” Sharpton…
This country has been going down the drain for a long time….
“Mark Carhart looked out over the packed New York conference room and told investors that Warren Buffett had it all wrong.”
Well the new age day traders, nasbomb, said the same. Mark can take his model and throw it in Encap’s pile. I don’t know which is more overbought, goldilocks or quant.
Warren simply states; “when the tide goes out, we’ll see whi is swimming naked”.
BC,
posted this link on the other thread, from one of my team’s forums, thought you’d like to see how favorably BC road trip rates amongst the faithful
http://www.thetigernet.com/forums/message.jspa?messageID=4651366#4651366
re: Tiger Blue, that “smelly” cheese and the foul stench of August financials – the aroma tends to linger
I don’t often agree with Reinvestor, but I agree with him on this one.
The Economist did a study on illegal immigration which found:
“At a given moment, migrants are generally net contributors to the public purse: they are disproportionately of working age, and the receiving country has not had to pay for their education.
http://www.economist.com/surveys/displaystory.cfm?story_id=E1_TQDNRQP
I agree. If illegal immigration was really that terrible for the economy, we would have taken a stronger stance already.
Republicans see illegals a source of cheap labor. Democrats don’t want to alienate their political base. As a result, the U.S. will not take a strong stance to eradicate it.
pro [30],
I loved this one;
“They have this little ### town Chestnut Hill? that has four bars”
That’s because after we graduated, Flutie era, the town said that’s enough.
I actually loved the whole thread. I may post there and tell them they are 100% correct. It must kill them that they are 0-2.
I agree with all the Tigers posts. It is Yuppieville. Half the fans are there to hob nob, talk about the derivatives market, how much they are making in RE, p/e ratios, lbo’s, etc… Everything except a damn football game. The only reasom we are half way decent is because they decided to give their last scholarship to a skinny defensive back from Natick. And that was only beacuse the school sent a bunch of quality players there.
It is and always will be a baseball/hockey town. [Speaking of hockey, where is Investor David?] Even the Pats are second class natives.
This is in response to BLB as well.
My arguement here really revolves around the real solution to the problem. Ostensbily, we can always point to overcrowding, crime, welfare and etc as the costs of illegals to the country, but that only addresses one side of the equation. It’s a little like looking at one’s expenses without giving due consideration to his income. Just as one would not be able to evaluate one’s financial postion by not considering the entire picture, one can not just look at the expense side of illegal immigration and evaluate it economically.
Labor represents approximately 7% of the cost of fruit products. Paying a living wage to anyone to harvest it would mean that we either all pay more or fruit producers’s margins will decline. If the demand for fruit is price sensitive, then the producers themselves have a vested interest in supporting the system of illegal immigration notwithstanding the societal cost.
Illegal immigrants also represent an expanding market for goods and services as once they become “Americanized”, they’ll want the same electronics, houses and cars that everyone wants. Their demand for goods and services yields an economic benefit that people are crawling all over themselves to provide.
Basically, this country is very reliant on illegals for variety of reasons and this is the main reason why any deportation scheme will not be pursued on a broad scale. The problem is our demand for both obtaining and providing services to them. That’s the reason why a guest worker program and other attempts are being pursued to give them some sort of legal status. After the public furor dies down, congress is certain to pass legislation to provide illegals some sort of status.
Bloodbath in Winter 2007 Says:
August 10th, 2007 at 9:24 pm
Reinvestor – I realize deporting 12 million people would be a major, major problem. And i realize that they will continue to return (or at least try).
But the long-term ramifications are even more dangerous. If this continues, by 2020, we’ll have what, 24 million illegals here? These people are a massive, massive drain on our health care and school systems and it will only get worse.
Plus, many (as evidenced by arrests) treat this country as if they don’t have to play by the rules because technically, all that will happen is that they will get booted. And their kids see this and many may end up behaving the same way. IN OUR PUBLIC SCHOOLS next to our children. That’s scary.
I’d say in most states, the police know where the illegals hang out to get those day jobs. Nationwide, I’d guess that would eliminate 2 million of them. We can start by rounding them up there and keep going. I’m sorry, but it really must be done.
As for the economic benefit, 50 years ago, there weren’t nearly as many illegals. Who did all these jobs? You guessed it – Americans. Initially, there will be some resistance to clean toilets, mow lawns, clean houses etc … but after a grace period, it should be fine.
Can ANYONE show me with real numbers how a guy making an off-the-books wage can be contributing so much to the taxing authority as to completely offset the costs imposed by him and perhaps mamacita and babies?
This argument doesn’t add up to me.
These guys did some of the number crunching.
http://www.cis.org/articles/2004/fiscalrelease.html
* Illegal alien households are estimated to use $2,700 a year more in services than they pay in taxes, creating a total fiscal burden of nearly $10.4 billion on the federal budget in 2002.
* Among the largest federal costs: Medicaid ($2.5 billion); treatment for the uninsured ($2.2 billion); food assistance programs ($1.9 billion); the federal prison and court systems ($1.6 billion); and federal aid to schools ($1.4 billion).
* If illegal aliens were legalized and began to pay taxes and use services like legal immigrants with the same education levels, the estimated annual fiscal deficit at the federal level would increase from $2,700 per household to nearly $7,700, for a total federal deficit of $29 billion.
* With nearly two-third of illegals lacking a high school diploma, the primary reason they create a fiscal deficit is their low education levels and resulting low incomes and tax payments — not their legal status or their unwillingness to work.
* Amnesty increases costs because illegals would still be largely unskilled, and thus their tax payments would continue to be very modest, but once legalized they would be able to access many more government services.
* The fact that legal immigrants with little schooling are a fiscal drain on federal coffers does not mean that legal immigrants overall are a drain. Many legal immigrants are highly skilled.
* Because many of the costs are due to their U.S.-born children, who are awarded U.S. citizenship at birth, barring illegals themselves from federal programs will not significantly reduce costs.
* Although they create a net drain on the federal government, the average illegal household pays more than $4,200 a year in federal taxes, for a total of nearly $16 billion.
* However, they impose annual costs of more than $26.3 billion, or about $6,950 per illegal household.
* About 43 percent, or $7 billion, of the federal taxes illegals pay go to Social Security and Medicare.
*Employers do not see the costs associated with less-educated immigrant workers because the costs are spread out among all taxpayers.
If I was an illegal, I sure would have bit the bullet, done a no-doc, 0 down, IO for an $800k house. If it went up, I’d refi. If it didn’t, I’d walk away. Good luck to them coming after me… no social security number, no IRS coming after me with a 1099. What a genius I am, right?
Now back to my vodka….. and slaving for my down payment.
BLB Says:
You continue to look at “expenses” without looking at economic inflows from illegal immigration. For your reading pleasure:
http://www.businessweek.com/magazine/content/05_29/b3943001_mz001.htm
August 10th, 2007 at 9:56 pm
Can ANYONE show me with real numbers how a guy making an off-the-books wage can be contributing so much to the taxing authority as to completely offset the costs imposed by him and perhaps mamacita and babies?
This argument doesn’t add up to me.
And yeah, my hunch is that there are 20 million illegals, not 12-14 million. This $hit goes under-reported.
bc
Ryan can flat out play, and I love the fact that your new coach is putting the offensive completely in his control. Can’t think of too many programs that would allow their QB to audible 100%. That will kill our defense.
You continue to look at “expenses” without looking at economic inflows from illegal immigration. For your reading pleasure:
http://www.businessweek.com/magazine/content/05_29/b3943001_mz001.htm
BLB Says:
August 10th, 2007 at 9:56 pm
Can ANYONE show me with real numbers how a guy making an off-the-books wage can be contributing so much to the taxing authority as to completely offset the costs imposed by him and perhaps mamacita and babies?
This argument doesn’t add up to me.
Veering back to RE …
i’m going to guess there will be a ton of newbies on this board over the weekend. Joe Six pack (as he/she was referred to on the other thread) will be googling, ‘new jersey and real estate bubble’ over the weekend, and winding up here.
Should you be one of the newbies, here’s a brief, brief primer from someone who has only been here since Aug 2006 (?), but wouldn’t be where i am right now without this board:
Obviously Bednar knows his stuff. If he talks, listen.
ChiFinance and Rich in NNJ also are guys you need to listen to.
Clot has really seen the light and since he’s a realtor, you need to pay attention to his posts.
There are others I am forgetting, but if the above guys posts, take heed, grasshoppers.
You continue to look at “expenses” without looking at economic inflows from illegal immigration.
Why don’t you provide us a summary of all these inflows you talk about using real numbers. Then we can see how these inflows exceed the expenses.
Don’t be lazy: show us. Don’t just link an article which avoids a direct comparison of income and expense. And be sure to demonstrate which of these inflows are to society and which are privatized.
Thanks in advance.
Bath (17)-
I put a comment on AAPL- and a lot of other top-notch stuff that’s being flat out given away- on today’s other thread.
Hang in there. Dammit, buy some more. I’m off the sidelines and back in the game. Just a huge pile of goodies out there now at incredible prices.
Of course, all disclaimers.
prof (30)-
Nice cool night like tonight, I could use some of that cheese.
prof (39)-
I hate all of you. All I got ’til basketball is a half-dead Butch Davis and a bunch of skinny little guys who won’t hit anybody.
You seem to think that I’m arguing that illegal immigration is fine. I am not. All I’m saying is that illegal immigration would not exist were it not economically beneficial. People like yourself, simply rail at the public cost of illegal immigration and focus your resentment at the illegal immigrants themselves rather than at the system the produces this phenomenon. The simplistic approach is to hate on the immigrant and complain about your taxes rather than to realize that you’re unwittedly subsidizing private interests that are making out like bandits. In other words, the public is left with the costs while someone else makes the money.
Basically, your anger is misdirected. Once again, for your reading pleasure:
http://money.cnn.com/2006/05/01/news/economy/immigration_economy/index.htm
Illegal workers: good for U.S. economy
The U.S. has benefited from illegal immigrants, most economists say, though some low-skilled workers have been hurt.
By Chris Isidore, CNNMoney.com senior writer
May 1, 2006: 3:08 PM EDT
NEW YORK (CNNMoney.com) – In the heated debate over the impact of illegal immigration on the U.S. economy, Andrew Sum is one of those focusing on the negative.
The economist – the director of labor market studies at Northeastern University in Boston – argues that the large supply of immigrants has displaced low-skilled U.S.-born workers, particularly the young and the poor, from jobs.
“About 85.5 of every 100 new workers are new immigrants in this decade,” he said. “At no time in the last 60 years have we come close to this. They’re really displacing young workers at a very high rate.”
But even Sum would concede that the U.S. economy is larger, and growing faster, due to the supply of illegal immigrants, and that most Americans with higher job skills are better off for their presence.
“Without the immigrants, we would have a decline in labor force of 3 to 4 percent,” he said. “We couldn’t have grown nearly as much as we did in the ’90s if we didn’t have immigrants. And in the last few years our growth would have been slower….”
Sum’s views point out the dichotomy that many economists see when looking at the impact of immigration on the economy.
Few economists will argue with the concept that the economy is stronger for the presence of the low-cost labor force.
And while most admit they have to make guesses rather than the educated estimates they would like to make, most say that economic growth would be a half a percentage point to 2 points lower without immigrant workers..
BLB Says:
August 10th, 2007 at 11:01 pm
You continue to look at “expenses” without looking at economic inflows from illegal immigration.
Why don’t you provide us a summary of all these inflows you talk about using real numbers. Then we can see how these inflows exceed the expenses.
Don’t be lazy: show us. Don’t just link an article which avoids a direct comparison of income and expense. And be sure to demonstrate which of these inflows are to society and which are privatized.
Thanks in advance.
Concerning illegal immigration: my experience having had my social security number stolen and used by an illegal immigrant has given me a special insight into why the “problem” will never be addressed. For several years (until a few months of my pressure on a Colorado DA) a hispanic man was using my ss number to work at an Office Depot; a plastic shop; a paint store; and a couple of other places in the south and southwest that I found out about when the irs contacted me about his wages, attributed to my ss, that I hadn’t reported. I learned that he had had tax witheld (presumably so that he would not stand out from his peers) and of course payroll tax (ss), medicare, etc. – typical employer deductions. This man will never see this money; i will never see this money; the IRS and SS Admin, however, got a substantial windfall for which there will never be a legal claim, and that is precisely why “illegal” immigration will never be checked, because these undocumented workers are infact, through the use of fake or stolen SS #s and attendent payroll deductions, subject to taxation without representation.
Want to kick them out? Tell the US Government to start paying its own way, tell the developers, landscapers, famrers and others to pay a minimum wage to legal workers only, and tell the redneck/conspiracy nutjobs to accept a national form of secure identification.
Its not the immigrants who are to blame for these systemic faults – its the cheap, paranoid, anti-government body politic of this great country of ours.
And, frankly, I’d rather live with people who’ve made an effort to come here to work, a line that stretches back the mere 400 years of our colonization, than one’s who are born here and feel they’re owed ANYTHING for that most unremarkable, mundane and trivial accident of place and time.
clot,
when I first moved to the city back in ’94, I had an apartment on the upper west side, on W. 79th and West End, not too far from Zabar’s. I went in there one day and thought I was seeing things when I saw that cheese right up there with the 5-star imports. It was nice to see. Stump Mountain tunnel was the key to the success of that cheese.
Old Tappan
SLD WALTER ST $1,162,500 9/6/2005
SLD WALTER ST $1,100,000 8/10/2007
Wyckoff
ACT LYONS ST $859,900 11/14/2006
PCH LYONS ST $829,900 12/16/2006
PCH LYONS ST $814,900 1/18/2007
PCH LYONS ST $779,900 2/5/2007
PCH LYONS ST $749,900 4/26/2007
SLD LYONS ST $650,000 8/9/2007
clot (45),
my sympathies. I usually have to endure many months of hapless b-ball.
Is Duke on your schedule at least? That should be a good way to relieve some frustration.
BTW, looks like the Tigers found a soccer player to kick for them. He will be playing on both teams this fall.
tick-tick-tick…
Dumont
SLD PERSHING ST $335,000 8/3/2004
SLD PERSHING ST $400,000 8/29/2005
ACT PERSHING ST $449,000 6/25/2007
PCH PERSHING ST $434,000 8/10/2007
Upper Saddle River
SLD UNION AVE $850,000 8/3/2001
SLD UNION AVE $1,150,000 7/2/2004
ACT UNION AVE $1,299,000 5/31/2007
PCH UNION AVE $1,199,000 8/10/2007
Translating –
‘start paying its own way… legal workers only… secure identification…’
So we need higher taxes, more police power, and an end to federalism.
‘not the immigrants to blame for systemic faults… cheap, paranoid, anti-government body politic…’
It is really the fault of those evil mom and pop businesses and those believe in individual liberty and the rule of law.
‘made an effort to come here to work.. than who are born here… accident of place and time.
What we really need is open borders and an end to the right of citizenship by birth.
Hmmm,
Let’s have a bake sale to get this started, or maybe we can put on a show!
I think I accidentally deleted the post regarding the temporary market ops from the NY Fed. Specifically, comments from CR reposted here. My most sincere apologies.
I do agree with Mr. CR, but I won’t dismiss yesterday’s operations as just “status quo”. There was a marked deviation in the collateral types accepted, as well as the frequency. I suppose you need to look at the issue from both a market-impacting, as well as psychological standpoints. If you look at it as market impacting, I agree, nothing to see here, after all, these were just 3 day repos, and just a drop in the bucket. If you look at it from a confidence standpoint, it was wildly different from the past, not to mention very successful.
IMHO, the Fed has made it abundantly clear that it will stand to protect the liquidity of the higher-tranches of MBS (those it accepts as collateral).
jb
Yesterday’s activities were aimed largely at defending the Fed Funds rate, a target, not a fixed value. The actual rate tends to vary, somewhat, around the target.
Take a look at what happened yesterday:
http://www.newyorkfed.org/markets/omo/dmm/fedfundsdata.cfm
08/02 5.24
08/03 5.24
08/06 5.26
08/07 5.26
08/08 5.27
08/09 5.41
08/10 – not yet reported
Various news sources yesterday reported that the actual rate for 8/10 was near 6%, the greatest deviation in some time.
The demand for cash was so high, that it pushed the actual rate to 5.41% on Thursday, roughly the equivalent of a half point hike on the target, and to 6% (reported) on Friday, the equivalent of 3 quarter point rate hikes.
Some folks were talking about dropping the fed funds rate to address the situation. I think it would have made defending the target even more difficult. With the demand for cash so high that it pushed the rate to 6%, perhaps the more appropriate move would have been a hike?
The decision to accept MBS was, IMHO, largely psychological.. Jawboning.. Confidence building.
jb
JB]
As of yet, the fed accepted only higher tranches of Agency MBS as collateral.
It will be interesting to see what happens at the end of three days.
The European banks have between 3-7 days to return $200+B loan.
http://www.ecb.int/mopo/implement/omo/html/index.en.html#key
More Repos?
Has anyone seen any more on the Citigroup $500M loss story? As a stockholder I am very concerned. Thx
#13 – Bottom line, if the goverment would be doing its job and deporting the illegals agressively, than 3 college bound kids would be having dinner with their familys tonight and I wouldnt have to here about that days killings.
Using the GAO report, Representative Steve King of Iowa points out that 25 Americans, on average, are killed by illegal aliens every day (about evenly split between motor vehicle accidents and outright murder).
Do the math: That works out to more than 9,000 deaths per year, or more than 36,000 deaths over the past four years. That’s more than ten times the number of Americans killed in Iraq over the past four years!
Oddly, I’ve seen people in my hometown protesting against the war in Iraq, but I’ve never seen anyone protesting against the illegal alien invasion that is killing tens of thousands of Americans right here on our own soil.
Biz not going well at Bear/EMC?
From BrokerUniverse:
Bear/EMC pull back – heard a rumor that Bear Wholesale suspended all programs and Funding
…
1. Full Doc, 24-Month BS, 1 Year Full Doc – limit CLTV to 80% for Primary w/ minimum FICO of 640
2. Limited, Lite, SIVA – limit CLTV to 70% for Primary with minimum FICO of 660
3. No Ratio, NIVA, No Doc – Suspended
4. Second Home and Investment – Suspended
5. Cashout – Limit CLTV to 70% with a minimum FICO of 660
6. No MI program – Suspended
…
So lets get this right:
1.Wells
2.Deutsche Bank
Now Bear all pull out of correspondent lending.
Others have tightened the guidelines to nothing.
A major warehouse line will not hold paper sold to a major ALT-A investment bank. Not part of the above story, but a problem for correspondent lending.
This is part of the industry is getting more and more wrecked, by the minute.
Good luck to everyone whose income was not based on A paper.
While it appears NJ’s market may be stagnant for a while, one Florida RE blog feels it has reason for optimism:
“Demographics are on the side of those who contend there might be a turn-around in the foreclosure marketplace. Large numbers of baby boomers about to turn 62 in 2008, increasing the pool of home buyers. In addition, the dollar is weak against the euro, keeping Florida and its sunny climate an appealing investment for foreign buyers. And all of that plays against the backdrop of a still-growing economy.”
http://www.sundaymorningtalk.com/
So, if demographics are on your side, you’re in good shape!
Seems like it’s always different here, wherever that might be.
jb
Anyone think there is a fair amount of extortion going on by BNP Paribas to manipulate the subprime markets?
Aren’t these guys the same guys who were involved in the UN oil for food scandel?
And called some shots the other day that rattled the market?
Thoughts anyone?
SAS
SAS (63)-
Wonder how deep into credit default swaps they are (or were).
That might be a good indicator. Seems as though that’s the only way to insure your position or get on the other side of the trade.
I find it amusing that Floridians think that boomers will continue to want to move there. I doubt boomers want to live with ‘old people’.
SAS (63)-
Then again, how do you really get on the other side of a “trade” of a mark-to-model security that’s almost impossible to trade?
Kind of an oxymoron.
Does anyone know how many listing withdrawls there have been this summer on gsmls? It seems like there have been many. Will these be re-listed in the fall or will we see these on the banks owned real estate listings or sheriff foreclosure sales?
#67
Just last week about thousand has expired.
#58
Thanks for making it clear and simple to the Hispanic audience on this blog.
JB (#55)
I’d like to think that the surge in cash demand from the Fed is nothing to worry about. Business as usual, right?
great post on fed repos over at CR forum, here it is:
its all about Trust, or lack thereof. basically the banks don’t trust each others valuation of ABS collateral thus they demand a higher interest rate thus forcing each bank to maintain higher reserves, which they don’t have, thus the need for more cash infusions by the Fed. HF’s don’t trust IB’s (Paulson and BSC), investors don’t trust HF’s, basically no one trusts no one anymore and its all b/c WALL ST came up with the great idea to hide risk in these derivatives that have been scattered far and wide. on top of that, what was supposed to be an advantage (dispersing risk) has now become a liability in that even you and i don’t know if we have ABS exposure. financial systems don’t and won’t run real well with that type of susicion. we’re in for a long ride (years for the trust to be built back up if at all).
Anonymous | 08.10.07 – 7:39 pm |
Clot – Yeah, Apple’s def a keeper. Here’s my problem – I can’t seem to find a website that’s NOT heavily pro apple. All the places/forums/message boards i’ve been able to find are either hard core FOR apple or against it.
Tough to find a place with reasonable discourse (like this board, which, despite some heavy doom and gloom, is invaluable).
With the weather so nice, I’m tempted to just check out open houses and talk to RE agents. I wonder how many were blindsided by all the news this week?
Hard to argue with Milton Friedman; abolish the fed. The fed caused the sky high inflation problems of the late 70’s. Although many can be blamed for this asset/credit bubble, who was the primary architect. During this unprecendented explosion of money supply, did reverse repos become extinct? Please bring back M3.
#3 Unrealtor:
I can tell with some certainty that Global Alpha was not Sub-prime fund like the ones that Blew up in Bear. It was a pure quant fund that traded on quant models. As the WSJ correctly pointed out “sometimes the computer doesn’t work”. We have seen the same scenario play out with Long Term Capital M.
A global head of quant strategies stated, “events that models only predicted would happen once in 10,000 years happened every day for three days.”
Nothing to see here, carry on.
Frank,
Haven’t heard anything more on this myself -senior folks did a big call across divisions talking about how everything was OK, a time of great opportunity clients, economy doing very well, blah blah blah
Of course, when I see/hear this type of stuff, I immediately get suspicious. All of these big firms’ hands have been in the cookie jar, just a question to what extent.
Time will tell-
#69 – I’d like to think that the surge in cash demand from the Fed is nothing to worry about.
We also need to consider that there might have been a lack of willingness to lend between banks (drop in supply, the propensity to lend).
jb
A global head of quant strategies stated, “events that models only predicted would happen once in 10,000 years happened every day for three days.”
Yawn, too many called the markets irrational this past week. Frankly, I don’t believe you can attribute human emotion and behavior to the markets.
The market has no knowledge of rationality. In reality, these folks thought they could predict the market with reasonable accuracy. When it turned out that their models went disfunctional, given recent market events, they simply blamed the market for being “irrational”. Of course, when their funds (and models) did well, they had no problem patting themselves on the back.
jb
Agora, no link;
“One final comment: in the context of the risky stock market in which we must operate, I want to provide quotes from two American CEOs about how we should address these risks. The first comes from Chuck Prince: CEO of Citigroup. He says, “The depth of the pools of liquidity is so much larger than it used to be that a disruptive event now needs to be much more disruptive than it used to be. At some point the disruptive event will become so significant that instead of liquidity filling in it will go the other way. When the music stops in terms of liquidity, things will get complicated, but as long as the music is playing, you’ve got to get up and dance.”
I think that’s a long-winded way of saying, “We have no clue.”
And having no clue is dangerous, hence the words of another American CEO, Warren Buffet: “Risk comes from not knowing what you’re doing.”
prof (51)-
I remember when they used to helicopter Igwebuike (the cause of my one-and-only near-death experience) from soccer games to football games.
Grim (54)-
Agreed. Taking only MBS on one of those repos was a calculated and effective message.
Bath (72)-
I’d guess 99% of all active RE agents have no idea at all what happened this week.
I came into the office this AM to find an offer on one of our listings, with the buyer proposing 100% financing, PLUS a seller concession of up to 10K on a 207K property.
Not even Vito on the corner would underwrite that one!
JB/CLOT/Rich or others:
Could anyone please provide details (address, prior sale history, prior and current listing history, etc.) on the following Ridgewood house:
mls 2385322
Thanks,
Eagle
Eagle,
I’m guessing that the MLS number is a GSMLS number as it doesn’t show up on the NJMLS.
Do you have any other info that I can use to match up?
Price
# of bedrooms
# of baths
# of 1/2 baths
A/C, 2-car garage, attic bedroom, etc.
I am sure that there are thousands of sellers, regular joes who go about their jobs completely oblivious to the typhoon that is blowing through the credit markets. They must be thinking we’ll wait for next spring when the market recovers and get our asking price.
Same for the buyers who are drinking from the NAR cup.
Poor suckers. They don’t see what’s coming.
Well as demonstrated by the illegal who
did the killing,anybody notice that nobody
wants to talk about Newark,Paterson,Trento,
Camden, and others as being Wide Open
Cities, open to all illegals.
No questions asked, get your food stamps,welfare,free health care,etc.
I see I am no longer alone on this blog.
Demarest
SLD VAN HORN ST $630,900 10/7/2003
ACT VAN HORN ST $799,000 9/21/2006
EXP VAN HORN ST $799,000 3/17/2007
ACT VAN HORN ST $760,000 3/26/2007
PCH VAN HORN ST $725,000 4/25/2007
W-U VAN HORN ST $725,000 5/30/2007
ACT VAN HORN ST $699,000 8/11/2007
If they get current asking they are looking at a yearly return of ~2.5%
Rich,
Thanks-
It is a Ridgewood, 5 bed, 2.5 bath, with pool in back, currently listed at 1.399 million, Willard school district.
Thanks,
Eagle
ACT 763 UPPER BLVD $1,695,000 4/18/2006
PCH 763 UPPER BLVD $1,499,000 5/30/2006
ACT* 763 UPPER BLVD $1,499,000 3/7/2007
W-C 763 UPPER BLVD $1,499,000 3/14/2007
ACT 763 UPPER BLVD $1,399,000 3/14/2007
TAX & ASSMT
2005 $18,073.60
Curr Yr: $18,850.20
Tx Yr: 2006
Land Value: $408,500
Improv. Value: $297,500
Taxable Value: $706,000
Rich– Thanks!
Eagle
From today’s NYT:
August 12, 2007
In Credit Crisis, Large Mortgages Grow Costly
By FLOYD NORRIS and ERIC DASH
When an investment banker set out to buy a $1.5 million home on Long Island last month, his mortgage broker quoted an interest rate of 8 percent. Three days later, when the buyer said he would take the loan, the mortgage banker had bad news: the new rate was 13 percent.
“I have been in the business 20 years and I have never seen” such a big swing in interest rates, said the broker, Bob Moulton, president of the Americana Mortgage Group in Manhasset, N.Y.
http://www.nytimes.com/2007/08/12/business/12mortgage.html?_r=1&hp=&oref=slogin&pagewanted=all
By the way, my brother bought his house in June of 1978.
He got the mortgage commitment 6 months earlier at about 8%. By the time of the closing, rates were at 13%. The bank tried to play games with “we lost your paperwork,” but he had sent it in via certified mail. Once he mentioned that, they magically “found” it.
Rich,
When I saw the address, I found it. It literally backs to the Main/Bergen rail tracks, and just on the other side of tracks is highway 507.
Come to think of it, it’s not surprising that majority of the wealth in this country is held by a small percentage of the population.
The masses get suckered into all kinds of scams including the great home ownership campaign run by the NAR and their minions who troll this board periodically reminding people of how wealthy they got on real-estate and why everyone should go out and buy now or be priced out of the market for ever.
I am a true capitalist to the core, but I can’t help but feel sorry for some of these people who get suckered into various scams/bubbles.
I’ve been told by a good source that
our Gov. has told Homeland Security not
to enforce Section 287 G which is to
train our locals on immigration enforcement.
So, even though we have had an illegal
kill 3 in Newark our Gov. will not want
the locals to arrest and deport them.
This is going to be interesting.
NJ an original “Welfare State”
Eagle – Anyone that looks at that Ridgewood house should do so on a weekday and weekend, and have the train schedule handy.
My guess is it’ll drop to 1.1 before anyone touches it. that’ll be in the neighborhood of 30% off asking.
With jumbo loan rates rising, you’d need $220,000 cash for a 20% downpayment, and i’m too afraid to bother calcuate the mortgage on an 880,000 mortgage (fuzzy math guess: $6,000 a month).
Eagle,
507/Franklin Turnpike is a county road and not that close. But the train… that’s close.
Most Recent Sales on Upper Blvd (house sizes and of course locations differ. I’m guessing odd numbered houses back the tracks)
$1,210,000 COL 463 UPPER BLVD 7/23/2007
$787,500 COL 416 UPPER BLVD 4/30/2007
$517,000 COL 327 UPPER BLVD 7/17/2006
$690,000 S/L 466 UPPER BLVD 7/20/2006
$729,000 COL 438 UPPER BLVD 5/26/2006
$587,500 COL 408 UPPER BLVD 8/25/2006
$937,000 S/L 775 UPPER BLVD 11/18/2005
$1,148,000 COL 581 UPPER BLVD 10/25/2006
$875,000 COL 589 UPPER BLVD 10/21/2005
$790,000 COL 446 UPPER BLVD 9/28/2005
Active
SLD 581 UPPER BLVD $1,148,000 10/25/2005
ACT 581 UPPER BLVD $1,499,000 7/19/2006
PCH 581 UPPER BLVD $1,350,000 9/7/2006
PCH 581 UPPER BLVD $1,250,000 10/6/2006
EXT 581 UPPER BLVD $1,250,000 3/13/2007
W-C 581 UPPER BLVD $1,250,000 4/5/2007
ACT 581 UPPER BLVD $1,200,000 4/5/2007 MLS 2713224
Currently leased out at $4,000/month as of 1/25/07
ACT 370 UPPER BLVD $699,900 5/10/2006
W-C 370 UPPER BLVD $699,900 8/28/2006
EXP 370 UPPER BLVD $699,900 10/11/2006
ACT 370 UPPER BLVD $759,000 2/13/2007 MLS 2705942
Currently Under Contract
ACT 540 UPPER BLVD $995,000 7/24/2007
ACT* 540 UPPER BLVD $995,000 7/31/2007
U/C 540 UPPER BLVD $995,000 8/6/2007
Est Cls Dt: 8/31/2007
From Today’s WSJ:
REVERSAL OF FORTUNE No. 1 Company In Mortgages
Faces Turbulence
Countrywide’s Bronx, N.Y.-born founder and chief executive, Angelo Mozilo, regularly reminds investors that he’s been through many ups and downs in the mortgage market. The son of a butcher of Italian descent, he got his start in the business at age 14 as a messenger for a New York mortgage company. In 1969, he and a colleague set up their own two-man mortgage company. At a time when home lending was mainly a local business, they had the audacity to call their firm Countrywide.
While credited with building a giant lender whose shares have shown outstanding performance over the long term, Mr. Mozilo, 68 years old, is often criticized for his compensation. Last year, his base salary, bonus and equity-incentive pay totaled $42 million, and he realized $72.2 million from exercising stock options. Countrywide has said his pay will drop by as much as 62% this year. Mr. Mozilo regularly sells stock in the company as part of what he describes as a diversification of his assets.
Mr. Mozilo also is known for blunt speech. He remarked in a conference call with analysts last year that big Wall Street firms competing with Countrywide “don’t know anything about the mortgage business.” He once dismissed efforts by rivals to gain tax advantages — by converting themselves into real-estate investment trusts — as equivalent to “putting lipstick on a pig.”
On Friday, the price of protection against a default by Countrywide on its debts shot up. It now costs investors $315,000 annually to insure $10 million in Countrywide bonds from default over the next five years, up from $230,000 on Thursday and $75,000 a month ago, according to data from CMA Datavision and Markit Group.
Countrywide was a leading promoter of pay-option adjustable-rate mortgages, known as option ARMs. These give borrowers several choices each month, including paying no principal and less than the full amount of interest normally due. If they take that route, their loan balance grows, setting them up for much higher payments later on.
Countrywide holds $27.8 billion of option ARMs on its books, and their quality is deteriorating. Payments were 30 days or more overdue on 5.7% of them as of June 30, compared with 1.6% a year earlier.
The company has scaled back its lending to subprime borrowers, those with the weakest credit records, to 4% of loans originated in the second quarter from 10% a year earlier. But it retains exposure to many past subprime and other risky loans sold to other parties. When loans are packaged into securities and sold, lenders such as Countrywide often keep a portion of the securities known as “residuals.” This portion bears the first losses from defaults. As of June 30, Countrywide had $1.46 billion of those residuals, whose value will fall or even vanish if defaults continue to rise rapidly.
Mr. Mozilo has conceded that Countrywide made some mistakes during the boom. But getting out of all the riskier types of loans before the housing market cooled “would have been an insight that only, I think, a superior spirit could have had at that time,” he said in a July 24 conference call, and Countrywide didn’t want to cede market share.
“Knowing what we know now,” he added, “we would have done a lot of things differently….The fact is we didn’t know.”
What are the housing futures market doing? Something to do with Shiller? Shouldn’t they be a good barometer?
From MarketWatch:
Citigroup seen taking $700 million in credit losses
Citigroup Inc. has reportedly lost more than $700 million in credit business in recent weeks, placing the world’s biggest financial services firm high on the list of casualties from the market-roiling credit crunch.
OK – Reech was on the money…
WSJ
Tough Market Hits Where It Hurts: Summer Vacation Frantic Investors, Bankers Navigate From Afar; BlackBerrys in Wilderness
By IANTHE JEANNE DUGAN and AARON LUCCHETTI
August 11, 2007; Page A1
At a Toronto hospital Friday, Frank Holmes told his sick father, “I love you, I love you.” Then, he slipped into the waiting room, and wrote a quick email to his office back in Texas.
“Just stay calm, cool and collected,” Mr. Holmes, the chief executive officer for $5-billion U.S. Global Investors, wrote to his head trader. “Use your quant models to capture opportunities and manage the risks. For every asset class, if anything falls more than two percent in a day, ask if it is a buy.”
In Louisville, 83-year-old Joseph Mullen called his neighbor, Mark Booker, on Friday morning. “What do you think of the market?” he asked.
Mr. Booker, a 41-year-old U.S. Department of Justice computer engineer who has off on Fridays, rushed over to brainstorm. Both decided neither to buy or sell, figuring the market will eventually turn around.
Across the country, everyone from fund managers to small investors struggled to navigate the vertiginous market. Some sold all they had. Others bought, others waited it out.
For many, the rout collided with summer vacation, forcing some to head back home to meet with nervous investors, and others to pound away on BlackBerrys and curse cellphone dead spots in the mountains. Some, like Mr. Holmes, were forced to tackle the situation from odd places.
At the Airport Hilton in Boston on Friday, Richard Steinberg was wrapping up his summer vacation by typing a letter to clients for whom his Boca Raton firm, Steinberg Global Asset Management, manages about $500 million. “Buckle your seat belt for a while,” he wrote, “and the turbulence will end.”
Duncan Niederauer, president of the New York Stock Exchange, was planning to take off Friday — his first day off since starting at the exchange in April. But instead of a long beach weekend with his kids, the former Goldman trader came into the exchange and monitored emails about how many messages the exchanges’ computers were processing amid the record trading volume.
“Who would have predicted that a record week for trading of equities would have been in the first week of August for any year?” Mr. Niederauer asked. Over the weekend, the exchange plans to improve the ability of its floor traders to access quotes from other exchanges and customers.
Also holding off on his vacation plans is Steven Grasso, a trading manager for Stuart Frankel. “This is what a trader lives for,” he says.
Mr. Grasso says one of the trickiest things to do in the recent volatile market is to separate fact from rumor about which bank is losing money and which mortgage company may be going out of business. On top of the robust rumor mill is technology that is moving markets faster than ever. So, news affecting markets breaks at any time, and people can act on it instantly. “It’s a global rumor mill now,” he says.
On Thursday, he wondered why a small fertilizer company stock known as CF Industries Holdings Inc. was taking a beating. “There’s no subprime play there,” he said.
That bafflement was shared by Jim DePorre of Bradenton, Fla., whose small money-management firm, Shark Investing, runs a Web site helping investors make sense of the market.
One of his stocks, Cal-Maine Foods, Inc., a producer and marketer of eggs, got clobbered. “What do eggs have to do with subprime?” Mr. DePorre puzzled.
He is planning to wait it out. “If you are making big bets you are crazy,” he says. “There is great uncertainty about how the subprime issue will play out over time. Meanwhile, this is the most illogical market I’ve ever seen.”
On his summer travels, Mr. Steinberg, of the Boca Raton asset-management firm, watched television business news at his hotel rooms, and had his computer logged into the office. Hiking in Acadia National Park in Maine recently, he tapped away on his BlackBerry. But then he hit a dead zone. “It was very stressful,” says Mr. Steinberg, who re-routed his family and some fellow hikers to a less-remote trail.
While traveling to Aspen, he attended a conference at the St. Regis Hotel. It was in the basement — another dead zone. So, every 10 minutes, he claimed he had to go the bathroom, raising concern among fellow attendees. “I would go and get my email and come back,” he says.
Allen Demby, a retired ophthalmologist-turned investment adviser, spends summers in Southern New Jersey, at his home near the ocean. This week, he heard from many clients for whom he collectively manages about $50 million. One nervous client insisted on a face-to-face meeting, so Dr. Demby drove two hours back near his home in Wyckoff, N.J., for the meeting.
“I told him, ‘We have a world-wide economy humming, so I believe this squall will pass,” says Mr. Demby, who is president of a New Jersey chapter of the American Association of Individual Investors, an educational organization.
Economist Leo Kamp, of asset-management firm TIAA-CREF, took off Wednesday for a long weekend in Martha’s Vineyard, Mass., with his family. The next day — when the Dow finished down 387.18 — Mr. Kamp spent a chunk of his afternoon exchanging emails and phone calls with clients and colleagues and checking the market’s fluctuations online.
Over a much-anticipated lobster dinner, he says his wife and children were a little wary as he fussed with his BlackBerry. “When things like this come up, they ask, ‘When are you going to stop working?'”
The previous week, a colleague, TIAA-CREF strategist Brett Hammond, was attending a family reunion at a ski resort in Snowbird, Utah, while the Dow fell 0.6% that week, including a 281.42-point drop on Aug. 3. “Ten years ago, we never would have been able to keep up with the markets in the way we can now, with new technology,” Mr. Hammond said, though he also has to cope with his family’s “CrackBerry” jokes.
Doreen Mogavero, president of New York Stock Exchange floor brokerage firm Mogavero Lee & Co., takes a two-week trip to the Hamptons, on Long Island, New York, every August, when trading typically slows down. This year, she says, her family will likely stay out there, while she gets up at 4:30 A.M. each morning and treks back to the city.
“If it were slow, I’d stay out there,” she says. “But I want to be at the exchange. The more people are here, the more we can trade.”
BC Bob -(79)
Nice post, thanks.
editorial
[edit]
The current skittishness has less to do with the severity of the mortgage problems than with the uncertainty over who is exposed to them and where the next surprise will turn up. Thus, BNP Paribas’s disclosure that three of its investment funds were experiencing liquidity problems was troublesome because it came so quickly on the heels of the French bank’s assurances, just a week earlier, that it had “negligible” exposure to the American subprime market. There was a similar mini-market panic this week when news that Goldman Sachs’s internal Global Alpha hedge fund was liquidating some positions led to exaggerated rumors of the fund’s collapse. Market players know that in these conditions more corpses are likely to surface, but no one can say exactly when or where.
That said, there’s no indication at the moment of a fundamental breakdown in solvency. Liquidity is scarce, which is why the Fed and other central banks have stepped up. Mortgage lenders such as Countrywide have found that the market for their loans has dried up, at least for now. But when the shouting stops, we will probably discover that most mortgages were unproblematic — that while some lenders and brokers got too aggressive, the vast majority of loans will be paid off as usual. This doesn’t mean there won’t be pain in the meantime, and possibly a good deal of it, especially for those holding the minority of loans that prove to be bad ones.
[edit]
Talk about moral hazard. No one wants to see someone lose his home to foreclosure. But many of those most at risk bought their homes with little or no money down, and so have very little at stake economically. Bringing in the feds to bail them out would send precisely the wrong message — that risky or overly aggressive borrowing will be rewarded by the government rather than punished in the marketplace. To the extent that bad loans were made, the market needs to clear, not be propped up by federal-aid programs.
The past couple of weeks, and especially the past few days, have been ugly — as the bursting of a credit bubble of this magnitude always is. The pain probably isn’t over. But if policy makers and central bankers can contain the damage and avoid making the problem worse, this too will pass. With the current market turmoil, Mr. Bernanke faces his first big test as Chairman of the Federal Reserve. The biggest favor he could do for himself and the markets is not to give in to the temptation to do favors for Wall Street or anyone else, and to remain focused on his price-stability mandate.
The U.S. and world economies continue to grow, and, short of a genuine solvency crisis, inflation should remain the Fed’s chief concern. To that end, whatever short-term liquidity is needed now to keep the markets orderly deserves to be withdrawn when conditions normalize. Letting the markets know that there is no Bernanke Put will also help bring the markets’ risk appetites back into line.
editorial
[edit]
The current skittishness has less to do with the severity of the mortgage problems than with the uncertainty over who is exposed to them and where the next surprise will turn up. Thus, BNP Paribas’s disclosure that three of its investment funds were experiencing liquidity problems was troublesome because it came so quickly on the heels of the French bank’s assurances, just a week earlier, that it had “negligible” exposure to the American subprime market. There was a similar mini-market panic this week when news that Goldman Sachs’s internal Global Alpha hedge fund was liquidating some positions led to exaggerated rumors of the fund’s collapse. Market players know that in these conditions more corpses are likely to surface, but no one can say exactly when or where.
That said, there’s no indication at the moment of a fundamental breakdown in solvency. Liquidity is scarce, which is why the Fed and other central banks have stepped up. Mortgage lenders such as Countrywide have found that the market for their loans has dried up, at least for now. But when the shouting stops, we will probably discover that most mortgages were unproblematic — that while some lenders and brokers got too aggressive, the vast majority of loans will be paid off as usual. This doesn’t mean there won’t be pain in the meantime, and possibly a good deal of it, especially for those holding the minority of loans that prove to be bad ones.
[edit]
Talk about moral hazard. No one wants to see someone lose his home to foreclosure. But many of those most at risk bought their homes with little or no money down, and so have very little at stake economically. Bringing in the feds to bail them out would send precisely the wrong message — that risky or overly aggressive borrowing will be rewarded by the government rather than punished in the marketplace. To the extent that bad loans were made, the market needs to clear, not be propped up by federal-aid programs.
The past couple of weeks, and especially the past few days, have been ugly — as the bursting of a credit bubble of this magnitude always is. The pain probably isn’t over. But if policy makers and central bankers can contain the damage and avoid making the problem worse, this too will pass. With the current market turmoil, Mr. Bernanke faces his first big test as Chairman of the Federal Reserve. The biggest favor he could do for himself and the markets is not to give in to the temptation to do favors for Wall Street or anyone else, and to remain focused on his price-stability mandate.
The U.S. and world economies continue to grow, and, short of a genuine solvency crisis, inflation should remain the Fed’s chief concern. To that end, whatever short-term liquidity is needed now to keep the markets orderly deserves to be withdrawn when conditions normalize. Letting the markets know that there is no Bernanke Put will also help bring the markets’ risk appetites back into line.
As if you didn’t know that leptokurtosis was going to be at the root of all of this? I warned you guys two years ago.
WSJ
One ‘Quant’ Sees Shakeout For the Ages — ‘10,000 Years’
By KAJA WHITEHOUSE
August 11, 2007; Page B3
Matthew Rothman is used to working with people who pride themselves on their rationality. He’s a “quant,” after all, one of a legion of Ph.D.s on Wall Street who use the emotionless rules of mathematics to pick trading positions. But this week, he caught a whiff of panic.
The trouble started Aug. 3, when stocks started moving not only in ways that commonly used models didn’t predict, but in precisely the opposite direction from what was expected. Equally troubling, the moves were far more volatile than models based on decades of testing assumed were likely. Those relatively minor anomalies escalated quickly this week, exploding into a global rout for quantitative funds by Wednesday.
As the global head of quantitative equity strategies for Lehman Brothers Holdings Inc., Mr. Rothman has an inside view into what went wrong. His story paints a situation that quickly snowballed out of control, as events damaged fund managers’ confidence in their models and led them to take steps that made matters worse. By Thursday, Mr. Rothman was so concerned that he wrote an extraordinary plea to the industry to remain calm.
“Wednesday is the type of day people will remember in quant-land for a very long time,” said Mr. Rothman, a University of Chicago Ph.D. who ran a quantitative fund before joining Lehman Brothers. “Events that models only predicted would happen once in 10,000 years happened every day for three days.”
The extent of the damage remains unclear, but people involved agree that a wave of losses hit quantitative investors in recent days, dragging down performance for a universe of investors that includes hedge funds and proprietary-trading desks at some investment banks.
According to data from Hedge Fund Research Inc., as of the end of June there was $40.7 billion invested in hedge funds following market-neutral strategies, a typical quantitative approach that some say was hit hardest.
Quant-fund managers tend to remain calm when markets turn sour, because they are able to profit from both up and down markets. Results aren’t determined by the up or down moves of the market, but by how well positions perform relative to expectations laid out in models. Designing those closely guarded models is where Ph.D.s like Mr. Rothman come in.
In recent days, quant managers have been anything but calm, exacerbating losses with swift selling, which observers said only begat more selling.
“It’s the contagion affect, one market affecting another seemingly unrelated market,” said Gregvan Inwegen, director of risk management and quantitative research for fund of hedge funds Ivy Capital Management. “So then once you have this butterfly flapping the wings, the thing just continues to affect other areas.”
It took a few days for investors, including Mr. Rothman, to realize that the shakeout had struck not just a few managers but the whole group. That led to the realization that the knee-jerk response to big losses — a quick exit — could lead to a broader meltdown.
On Thursday, Mr. Rothman published an industry note explaining the situation and pleading with quant investors to remain calm. “Self-fulfilling prophesies of losses can come true if investors stampede and head for the door in unison,” he said in the note. “We certainly hope this situation does not materialize and stress the need for investor calm.”
http://en.wikipedia.org/wiki/Kurtosis
http://en.wikipedia.org/wiki/De_facto
from 105]
“Events that models only predicted would happen once in 10,000 years happened every day for three days.”
The good thing is we don’t have to worry about this for another 30,000 years!
Watching bllomberg interview with TOLL CFO
Areas of Worsened “Housing Demand”
1]Forida
2] Las Vegas, Reno
3] New Jersey
4] MA
Immigration is a problem yes but at the end of the day its more of a partisan political debate;
the absolute real reason we will go broke and the impending disaster is Medicare. Hands down, everthing else, including illegals, social security, etc are small potatoes.
Social Security is not small potatoes
cf/bc/others
Are there tradable fdic insured money market funds?
commanderbob- immigration has been a feature of our social and economic landscape for 150 years, both of the legal & illegal variety, with varying costs but a couple of constants: they are attracted here to work by large companies looking for cheap labor (agriculture, railroads in the 1860s -70s, etc.); and people only really start grousing about immigration’s costs (overlooking the savings in cheap labor) when there are larger societal problems lurking.
Rant on “liberals!” all you like, but the conservatives of the agricultural industry are presently the single largest impediment to enacting (or really providing enforcement of) laws that would demand that employees be legal workers (a move that would drastically cut demand for illegal labor) and it is the right-wing paranoid nutjobs who stand in the way of making a social security card (already a form of national id the sinister manifest of “the end of federalism!” alluded to in a prior post) at least as secure as a credit card.
Illegal immigration has costs, but also benefits, and in the present market (with tighter employment regulations stymied largely by conservatives) these benefits represent a net gain. don’t like the effects on society? well, that’s the unquantifiable costs of the cheap seats, one conservative spreadsheets tend to ignore.
This thread started with those awful murders, and as with most of Newark’s murders, the bulk of NJ’s problems, like the Nation’s, are homegrown.
Deporting all the immigrants wont address the ridiculous pension deals and entitlement of state and federal employees, far beyond anything available in the private market; the calcifying effects of concentration of wealth and age, leading to a class of people living way beyond their contributions to social security at the cost of future generations; and, most notably, the disloyal behavior of all the fortune 500 companies that have spared the illegal immigrant an arduous journey by taking our jobs directly to them in Mexico, China, India, and anyplace where the american worker can be undercut.
Cry about liberals all you want, but until you’re willing to face that its largely capitalism and conservatives who’ve nourished the demand for illegal immigration, you might better use your time learning spanish.
http://article.nationalreview.com/?q=Y2Y5NGVmODQzNTEwOGZmMzExNzRkYzBkMzA4OGI1ZGM=
Currently there are about 44 million mortgages in the U.S., and less than 14 percent of them are sub-prime. And only about 13 percent of those are late on payments, with the majority of late payers working through their problems with the banks.
So, all in all, when you work through the details and get down to the number that really matters, only about 0.6 percent of U.S. mortgages are currently in foreclosure. That’s up a hair from roughly 0.5 percent last year. That’s it.
Actually, that’s not it. Things are actually better than the numbers suggest, since sub-prime-mortgage homes are less expensive than prime-mortgage homes.
This makes sense. Wealthier people, generally, can afford costlier homes than less-wealthy people. The recent sub-prime surge brought large numbers of moderate-income families into the home-ownership market, and their houses are less expensive than most. Therefore, the dollar impact of the sub-prime default is smaller than if it were a prime default.
With approximately 254,000 mortgages in foreclosure at the moment — up from roughly 219,000 last year — the sub-prime meltdown has given us an increase of 35,000 mortgage foreclosures over the last quarter. Since the average sub-prime mortgage clocks in at almost exactly $200,000, we’re looking at an approximate $7 billion increase in foreclosed value in the first quarter of this year.
How big is household net worth in the U.S.? … About $53 trillion. In other words, the recent increase in sub-prime foreclosures amounts to 0.01 percent of net U.S. household wealth.
ADA 114] it’s not just subprime anymore.
>
http://www.bloomberg.com/apps/news?pid=20601087&sid=a_Wr2eJ6sESE&refer=home
The ratings firm[Moody’s] said today its expectations for losses on Alt A mortgages will rise between 10 percent and 100 percent, depending on whether a loan pool has a lot of debt extended to borrowers with low credit scores and little money for down payments. It’s also raising loss expectations when borrowers don’t fully document their incomes.
chicagofinance Says:
August 11th, 2007 at 2:39 pm
OK – Reech was on the money
Chi,
Wrong. Better chance that Barry Bond’s is clean.
His premise was the market moves were distorted by light voume, vacation time. Since when does it matter where trading originated from.
“NYSE Euronext (NYSE Euronext: NYX), the world’s largest and most liquid exchange group, today reported record transaction(1) volumes in its U.S. and European cash equities trading operations for the week-ended August 10, 2007.
The company’s U.S. equities trading operations, the New York Stock Exchange and NYSE Arca, reported a combined volume of over 23 billion(2) shares traded during the week-ended Aug. 10, a new weekly all-time high for NYSE Group. NYSE Group traded more shares than any other U.S. cash equities market registering a new top 10 volume day each day of the week, including a new all-time record of 5.37 billion shares traded on Aug. 9 and a record average daily volume of 4.7 billion shares traded daily during the week.”
http://www.jimcramerblog.com/
“The most troubling thing about yesterday was not just the size of the losses, but the fact that turnover in the NYSE rose 8% above the previous day”s already inflated level. A 1% retreat in Nasdaq volume enabled that exchange to dodge a “distribution day.” According to our research, yesterday”s volume in the NYSE of 2.8 billion shares marked a new record high level, marginally exceeding the number of shares that changed hands on July 24, 2002.”
[the moneyblogs.com]
About 40%[?] of loans made in 2006 were Alt-A.
bear [112],
http://www.fdic.gov/consumers/consumer/information/fdiciorn.html
It’s subprime yesterday, alt-a today and maybe prime tomorrow. The reason I feel this to be true is because I consider myself to be smack in the middle of the group of the most common recent mortgage purchasers. Of my 6 best friends (couples), only 2 have standard 20% down loans. The others are all piggy backing ARMing or IO. Of the 4 with variable rate loans, 2 have already come to me for advice on getting out of the lousy situation they are in.
The 7 billion dollar example above is only for subprime and is a number derived prior to the monstrous amount of resets about to occur. IMO, we are only in the stage where people are starting to struggle and are still able to get by or make late payments. If equity in housing was what kept the economy growing from the tech bubble burst until now…then where is the growth in the economy going to come from now? I don’t hope for a recession, but if people stop spending and people start losing their jobs due to layoffs caused from the growth slowdown, that default number is going to climb greatly and into the alt-a and prime sector. And most of my peers are probably somewhere between alt-a and prime.
Sorry if this was already posted. I am not sure I agree with the conclusion. How much land is left to build houses rather than high-rises in dense populated areas?
http://www.townhall.com/columnists/ThomasSowell/2007/08/08/sub-prime_politicians?page=1
“Amid all the hand-wringing and finger-pointing as housing markets collapse, 8mortgage foreclosures skyrocket, and financial markets panic, there is very little attention being paid to the fundamental economic and political decisions that led to this mess.”
“But why were housing prices going up so fast, in the first place? A number of studies of communities across the United States and in countries overseas turned up the same conclusion: Government restrictions on building.”
#120:
If the no land left theory is true, why have sales been declining over the past 2/3 years?
Is more land coming on the market?
Lack of land availability is definitely a problem in the bigger metro areas, but that doesn’t soley justify a 100% increase in home values in 5 years.
No matter how you look at it easy and cheap credit was the single biggest contributor to this bubble. It over shadows the genuine growth triggers like increase in incomes, less land, etc, etc.
idtheft,
Re: #113
Rock on!!
120]
http://www.msnbc.msn.com/id/10819895/
… has opened nearly half a million acres of federal land in northeastern Alaska to oil drilling — a move blasted by environmentalists but praised by industry, which notes the area is in a long-designated petroleum reserve.
Weird. I’m backed up on my NYT real estate sections. I just saw that a house in clifton (!!) in the coveted ‘on the market’ section. Color pictures and all! The house was for … only $550,000.
I looked it up on realtor and zillow and guess what? It doesn’t look terrible. At all.
MLS: 2705490
Rich, can you find the backstory? How long on the market, what it was bought for and when, etc?
The one big roadblock to stop us from even looking: Clifton HS ranks 280 in the state among all public schools. That’s deplorable.
http://www.njmonthly.com/topschools/hslist3.lasso?-MaxRecords=50&-SkipRecords=250&-SortField=rank&-SortOrder=ascending&county=&high_school=
Still, the photos of the house do look great – so much so that since we dont have kids yet, and they wouldn’t be joining schools there for another 7 years … it kind of makes you wonder. Would we jump at this when it falls to 475k this winter?
123#, thanks for good link.
it will make oil price move faster to my target.
ADA – You really, really need to read this article about subprime foreclosures due this Fall.
http://select.nytimes.com/gst/abstract.html?res=FB0A11F63B5A0C728CDDA10894DF404482
yo bi,
That news is almost 2 years old. I was pointing out how government restrictions can change over time.
i am not for or against legalization of illegals since i don’t know it would be good or bad for the nation. but i do know: 1) the illeal immigration bill will be passed in one year or two; 2) it will drive up RE price and rent; 3) a few investors i know already position theirselves anticipating such a move; 3) some people in the area of high concentration of illegals will fly to less concentrated areas, where the price will move up 10% by next spring.
Blood,
Here is the history:
MLS# 2622870
ACT $669,000 6/8/2006
PCH $635,000 6/28/2006
PCH $595,000 8/9/2006 DOM: 63
EXT $595,000 9/7/2006 DOM: 92
PCH $575,000 9/29/2006 DOM: 114
EXT $575,000 12/8/2006 DOM: 184
EXP $575,000 12/12/2006 DOM: 188
Expired, relisted under:
MLS# 2705490
ACT $578,000 2/9/2007
EXT $578,000 6/11/2007 DOM: 123
PCH $555,000 6/25/2007 DOM: 137
EXT $555,000 8/10/2007 DOM: 183
how much alt-a is out there?
this article says 455.5 bn just between ’05-’06.
“The negative watchlist constitutes 2% of the roughly USD 455.5 bn alt-A mortgages rated by the agency between October 2005 and December 2006.”
ABS investors favor subprime yields over alt-A despite selloff
http://www.ft.com/cms/s/b23f1414-467b-11dc-a3be-0000779fd2ac,dwp_uuid=e8477cc4-c820-11db-b0dc-000b5df10621.html
this .pdf says $54.2 bn in 2002.
http://www.securitization.net/pdf/nomura_journey_060303.pdf
one more thought: NJ real estate market did not crash and will not crash thanks to legal and illegal immigrats. for example, i cut and paste a comment from kannekt site on the the ownership of Shore (i guess it is a condo property in jersey city):
“based on the names of owners there are 113/170 units owned by asians. Among those 49 are Indian names.”
I may change my position if 1) U.S. government starts to prohibit americans import brides from Russia; or 2) you RE bears can figure out what this location is used for:
http://offthebroiler.wordpress.com/2007/05/10/nyc-solve-the-mystery-of-the-duck-butt/
113#
although my english is not that good, i think all other languages should be prohibited in public place. it will completely solve all the problems we have here today.
> Cry about liberals all you want, but until you’re willing to face that its largely capitalism and conservatives who’ve nourished the demand for illegal immigration, you might better use your time learning spanish.
124#, before you jump in this winter, think two things:
1) who are going to buy my house when i want to move?
2) if the deal was so good, why no other bidders?
bi:
Your are one of those *Investors* who like to share their best *Investment ideas* on public blogs. I wish great hedge funds and money managers would share their best investment ideas with the public.
Keep coming up with excuses why you think the real estate market won’t correct further. It’s too late to sell this hype. Might have worked a few years back, but now your average joe has gotten more cautious.
Thanks, JB.
Bi – with all due respect, what you wrote here …
but i do know: 1) the illeal immigration bill will be passed in one year or two; 2) it will drive up RE price and rent; 3) a few investors i know already position theirselves anticipating such a move; 3) some people in the area of high concentration of illegals will fly to less concentrated areas, where the price will move up 10% by next spring.
… is pure lunacy.
BC Bob 118]
I’m worried that my brokerage might have invested my account cash balance in CDOs or other exotic products. What is the best way i can protect my cash balance without actually withdrawing? For the time being, i don’t care about the rate of return.
idtheft (#113)
Annex Mexico
let’s get it over with. The boomer’s are retiring, they deserve a better destination than North Cackalacki, San Simeon, or ….Naples.
When we’re done annexing Mexico, let’s set our eyes further south: Belize, Guatemala, Panama, etc. Might as well go to the equator. Good surfing in those parts I hear.
The only difficulty with annexation, is that we then have to allow the PRI to win every 99 out of 100 elections.
Time to reverse the osmosis.
rebar (135)-
Most brokerage accounts can- and will- only invest your cash in a vanilla money market “sweep”-style account.
Check back to your original agreement to view the types of instruments that your cash can be held in. If you have online access, you can probably view the instrument and its parameters, as well as your entire account agreement.
clot,
did you cover all your shorts? i flat out all my long/short friday and have only pph long for now.
prof (136)-
Tons of retirees are going to Belize, the Dominican Republic and Costa Rica. The exodus started a couple of years ago.
I’ve referred several clients to the Pacific coast of Costa Rica. One was a former NFL cornerback, who needs year-round warm weather to keep his arthritis in check.
You’d be amazed to see what 1M USD buys down there. Just sick.
Makes me wanna do it, too.
From the AP:
Bridge repair costs could refuel talk of raising gas tax
Less than half of the pavement on New Jersey highways is rated as adequate. Nearly a third of its bridges are either structurally deficient or obsolete. Traffic congestion helps give New Jerseyans the nation’s third longest average commute.
While the Minneapolis bridge disaster has placed increased attention on the nation’s crumbling infrastructure, New Jersey’s decaying roads and bridges have never been too far out of the minds of New Jersey governors and legislators.
They just haven’t been able to agree on how to fix the problem. Tangled in political worries, they’ve declined to increase the gas tax and find significant new funding even while struggling to fix roads and bridges.
The gas tax hasn’t increased since 1988, giving New Jersey the nation’s third-lowest gas tax at 14.5 cents per gallon, according to the Federation of Tax Administrators.
But New Jersey also has billions of dollars in unmet transportation needs.
“That it’s a badge of honor to have a minuscule gas tax is bogus,” said David Weinstein, spokesman for AAA Mid-Atlantic. “The system hasn’t gotten what it needs since it was built.”
County officials estimate they need $3 billion to fix their bridges.
Gov. Jon S. Corzine estimates the state needs as much as $7 billion just to fix its 1,500 obsolete and about 700 deficient bridges.
Puerto Rico is an up-and-coming retirement destination, too.
Just don’t get your mortgage from Doral Financial.
OT, the Giants defense s**cks.
Grim (141)-
“Gov. Jon S. Corzine estimates the state needs as much as $7 billion just to fix its 1,500 obsolete and about 700 deficient bridges.”
Maybe it would cost less to give every NJ resident lessons in how to escape a submerged car.
Tricky business with real estate down in Mexico though, right? I’ve heard that your property “deed” is more or less controlled by another party, like a bank, if you don’t have citizenship.
I guess there are ways to make that work if you have enough “faith” in who you are dealing with.
one more thought: NJ real estate market did not crash and will not crash thanks to legal and illegal immigrats.
Bi,
Immigrants are an important part of NJ’s population. However, what’s really happening is that immigrants are replacing American’s in New Jersey, not adding to the population. The number of immigrants moving to NJ aren’t even enough to replace the people leaving NJ.
In 2006, about 72,000 people left NJ, while the state took on 54,000 new immigrants (legal and illegal).
OT, the Giants defense s**cks.
Just Awful
At least I have Rutgers football to look forward to.
142#,
clot, why not if you can get much beter rate?
even if Doral goes belly up, your loan will be moved to other lenders (i wish it would be forgiven)
> Just don’t get your mortgage from Doral Financial.
146#,
source? and you have breakdown town by town?
thanks
> In 2006, about 72,000 people left NJ, while the state took on 54,000 new immigrants (legal and illegal).
clot,
Thanks!
RentinginNJ,
A new defense and new coordinator for big blue. It’s gonna take a while before they get it.
Gov. Jon S. Corzine estimates the state needs as much as $7 billion just to fix its 1,500 obsolete and about 700 deficient bridges.
Fear is always the perfect cover for raising taxes…(in this case the gas tax). …The pols. will play on the bridge collapse tragedy in Minnesota. They will raise the gas tax…they will fix a few token bridges…slap a coat of paint on others…and will have themselves a new permanent source of revenue to be squandered away.
Well said.
jb
source? and you have breakdown town by town?
US Census, Components of Population Change 2000 – 2006:
http://www.census.gov/popest/counties/CO-EST2006-compchg2000_2006.html
The components of population change (births, deaths, internal migration and international migration) are available at the county level.
Total population change (not broken down) is available by town.
I will post the link in a second message to avoid moderation.
#128,
The immigration bill will not be passed anytime soon, because we are heading into a bad and long recession cause by a huge real estate bubble. When unemployment hits 6%+ no one will care for illegals. When unemployment is at 4% there’s enough business that need them.
Annual US Census population estimates by town:
http://www.census.gov/popest/cities/SUB-EST2006-states.html
#141,
Just jack up the taxes Jon, you know how to do it, what’s another tax increase? they will complain but pay and vote for you anyway.
#113,
You just don’t get it, it has nothing to do with liberals or conservatives, or immigration in general, we need those poor souls to help us pay off our debt. It has to do with obeying and enforcing our law. Once you start ignoring and not enforcing the laws, the entire country fall apart, and that’s what happing right now.
prof (145)-
Most RE in Mexico that’s mortgaged is via Trust Deed. That is, the deed is held by an intermediary- in the mortgagor’s name- until it is satisfied in full.
California is also a Trust Deed state.
bi (148)-
A failing bank in Puerto Rico is unlikely to be able to get you a “better” rate.
Bad underwriting is what put Doral on the track to Palookaville 18 months ago…well before other lenders started having problems.
OT-
If you’re a baseball fan, the best story of the season- hands down- is Rick Ankiel’s comeback.
Illegal aliens are not “immigrants.”
“Immigrants” apply for entry into the United States at the consulate in the home country, and enter a queue to begin the immigration process in accordance with US law.
Illegal aliens are criminal trespassers.
Also, the “mass deportation” straw man is tired. Today, when an illegal is caught by authorities for an unrelated reason (e.g., speeding on the highway), the INS doesn’t even want to take custody, and the police eventually let the illegal go. That’s just stupid, and that’s the exact moment when illegals should be deported (after first verifying there are no outstanding warrants for rape, murder, or other crimes they may have committed on US soil).
how to find stats for sub-prime lending in your town?
1) go to
http://www.nj.com/news/bythenumbers/
2) click “home sale” and then “subprime lending”
3) locate MAP YOUR NEIGHBORHOOD area and
Enter an addresss:
Example: 938 Broad St., Newark NJ
It is heartening to read how callously and casually people are talking about deporting illegals – illegals who have uprooted from their distant homes, have lived in this country for many years, whose children have been raised here for the better part, a vast majority of whom are doing honest work for a pittance, doing menial and low-paying jobs no one else wants to do, without any benefits or protection whatsoever. I said heartening, because it means capitalism is at work.
Capitalism relies on an under-class for whom the middle-classes have no sympathy for. Middle-classes usually are the road-blocks to an exploitative business and political power class from bull-dozing the under-class. Hence the need for an under-class that would be completely ‘othered’ by the middle-class to the point of dehumanisation. And that has been completely and successfully acheived it seems.
The working-classes of Europe post-industrial revolution was such a dehumanised class until enlightenment came about when egalitarianism within the society took up the cause of this under-class. Europe dehumaised the colonised people instead to fill the vaccum while US used slavery.
US now has the illegals, while Europe has lost its compettitive edge due to welfare societies that include everyone universally including the illegals and refugees. Soon they will have to abandon such universality and will have to allow a flourishing unprotected illegal industry.
Such a ‘distanced’ and ‘othered’ under-class exists in all capitalistic societies. In India, in its lower castes.
Un (162)-
You’ll be the first to whine here when a head of lettuce costs $6 at your local ShopRite.
Hypocrite.
Sugee (164)-
Well put.
the illeal immigration bill will be passed in one year or two; 2) it will drive up RE price and rent
I’m not sure I follow your logic here.
Are you saying that illegal immigrants provide a cheap source of labor in the construction industry and therefore act to moderate home prices?
If so, I’d say it depends on where you live. Labor costs for home construction do not play a big role in setting home prices in NJ. Home prices here are driven mostly by the supply and demand for existing homes.
In places where you have ample land and can make a decision to buy an existing home or build a new home down the street, home prices are more driven by the marginal cost of building the next home. In those places, labor costs are a more important factor. Higher labor costs caused by constraining the supply of cheap labor could put upward pressure on home prices (everything else being equal).
In New Jersey, a strong illegal immigration bill would more likely put downward pressure on home prices. Illegal immigrants (as a source of cheap labor) don’t act to moderate home prices here (as explained above). So, higher construction costs wouldn’t matter much. At the same time, illegal immigrants do add to the demand for housing in NJ. So, you have less demand for housing.
OT again, for all the Yanks fans:
Wanna face this guy in the playoffs?
8-1 on the road this year, 1.65 ERA…and definitely “your daddy”:
http://sports.espn.go.com/mlb/recap?gameId=270811101&action=playvideo&hcmp=motion
For all who have missed him, So Cal Mtge guy has 2 new posts.
KL
In 2006, about 72,000 people left NJ, while the state took on 54,000 new immigrants (legal and illegal).
Isn’t it also estimated that 100,000 people will leave NJ in 2007?
kl (169)-
Thanks for the heads up. Just brilliant stuff!
Yankees Kryptonite:
Chone Figgins
Josh Beckett
Vladimir Guerrero
Garret Anderson
Manny Ramirez
David Ortiz
John Lackey
Curt Schilling
Jonathan Papelbon
Orlando Cabrera
Magglio Ordonez
Carlos Guillen
Curtis Granderson
Joel Zumaya
Placido Polanco
I cleaned bathrooms on the NJ Turnpike. I worked on pipe crews putting 2000 pound sections of concrete pipe in the ground 10 hours a day standing knee deep in mud. I worked in restaurant kitchens scrubbing pots and washing dishes, scraped slop out of grease pits at country clubs, pumped gas in sleet and freezing rain on overnight shifts outside the Holland tunnel.
Ah yes… pity the poor illegitimates. Thank God I’m a pretentious, pompous, conceited member of the esteemed middle class, where I can enjoy opulence on behalf of the plebs toils and suffering.
gary (173)-
And, illegals are doing most of those jobs now.
Otherwise, they wouldn’t be getting done.
Here’s the choice:
Break the law of a country that is not your home to give yourself and your family a chance at a better life.
You’re on the Mexican side of the Rio Grande. You’re about to walk over. At that moment, do you think of yourself as a criminal? Do you even think you’re doing anything wrong?
Clotpoll – gotta love ya man, especially after the Richard “effluent” comment” HA HA HA
but as of now the YANKEES HAVE A BETTER RECORD HAN THE METS
(175)-
That’s not to say that it isn’t wrong.
However, is our focus all it should be when there’s a profusion of Arab emigres into Acapulco and Guadalajara? Why does someone move from Saudi Arabia, Iran or Syria to Mexico?
It ain’t for the seafood and bullfights.
Kim (176)
My team is in a swoon. Big time.
However, the Phillies and Braves don’t have enough to win the division. All you have to do is get into the playoffs.
Then, everything changes.
Ben Stein says We’re all Chicken Littles
Thanks Ben. Bueller? Bueller?
how to find stats for sub-prime lending in your town?
Data is from 2005.. While somewhat useful, not exactly recent.
jb
From NorthJersey.com:
How N.J. got $30B in the hole
Any way you count it, New Jersey is deep in debt.
The state owes nearly $30 billion to its creditors and just paying the cost to cover that debt is eating up more than $2.5 billion a year.
That means less and less money each year for aid to public schools, hospitals, towns. And – directly or indirectly – it means higher taxes.
The situation is so bad that Governor Corzine is preparing to sell off state properties – everything from the lottery to the New Jersey Turnpike – to raise money.
“We are the guys who got stuck at the end of the game of musical chairs. We’re trying to find a way to dig out of the hole we’re in,” state Treasurer Bradley Abelow said.
Here’s a look at how the state got this far in debt, what it means and what some say New Jersey should do to steady its financial future:
Just how much does the state owe?
The most recent calculation puts that figure at $29.7 billion – or roughly $3,500 for every man, woman and child in New Jersey.
That total debt figure jumps to $37.4 billion once money owed by independent agencies such as the New Jersey Turnpike Authority and the Sports and Exposition Authority is included.
And the total amount doesn’t cover the hundreds of millions of debt already approved and scheduled to be borrowed, like the $400 million in bonds for affordable housing to be issued this week, or the more than $650 million for open space preservation that’s on the November ballot for voter approval.
What does all that cost?
The state is paying $2.6 billion this fiscal year to cover the cost of borrowed money. That’s up more than $1 billion in the past five years alone.
It costs taxpayers more now to pay for borrowed money than the state will pay on its massive new property tax rebate program. Debt service eats more of the current budget than aid to suburban towns, public colleges and universities, even more than it costs to repay hospitals for treating uninsured patients.
State officials say it’s going to get worse. In four years, it will cost taxpayers another $500 million – or a total of $3.1 billion – just to pay the principal and interest on the current loans. Again, that financing charge doesn’t factor in the already scheduled debt and any new loans.
Where did all the money go?
Anyone living in Hoboken or JC?? Good luck trying to get in or out.
Amid bridge concern, state sets Pulaski Skyway work
http://www.newsday.com/news/local/wire/newjersey/ny-bc-nj–newjerseybridges0810aug10,0,5627077.story
When will be the best time to buy a home in NJ??
#181,
Why don’t they sell the Turnpike and the Parkway? They can pay off the debt in one instance and the problem is gone.
The tolls have not risen on the Parkway in decades they should be up to $5 by now. So are the gasoline taxes. They have no problem raising the sales tax that hits everyone, why not just hit the people that drive and leave everyone else alone?
Good luck trying to buy a 400K+ house in NJ.
NYTimes; In a Credit Crisis, Large Mortgages Grow Costly
http://www.nytimes.com/2007/08/12/business/12mortgage.html?_r=1&hp=&adxnnl=1&oref=slogin&adxnnlx=1186920373-qe9EXgw85wuSjO5iYZ03oQ
I know this is true because the non-agency desks have been scratching their heads looking for work for few weeks now.
http://www.ocregister.com/ocregister/homepage/abox/article_1806121.php
I know that’s a California article. But just remember back. A year ago. Maybe when you went to look at an open house in 2005. Did you EVER think you’d read an article like that?
Clicking on the Orange houses and getting the mortgage data. It’s like Zilloclosure.
When will be the best time to buy a home in NJ??
When it makes sense for the buyer.
jb
Let the credit shrink baby!
This is really getting fun ;)
I think this shake out has only just begun and its going to get alot worse before it gets better.
SAS
clotpoll 175,
I guess my point is that it doesn’t matter to me what a persons view is on illegal immigration; however, they should keep their ivory tower opinions in check because unlike the majority of the current entitlement generation, a lot of us ate sh** and drink p*** laboring at the worst jobs with little or no benefits through high school, college and beyond.
But of course, the one benefit we always had was the pleasure of having to pay taxes despite the “pittance” we were earning.
Just as a suggestion, maybe the Paris Hilton generation should put down their iPhones, unplug their iPods, shut off the flat screen, give up the “3” series, sell some of their bling and have a hand at some of these jobs. Maybe, just maybe, that will stem the flow of illegals and ease the burden on the system.
#188
so %20 down/ %30 of your income?
do you think it will come back to those standards?
Gary, and Clot
Gary were most of your wonderful jobs off the books?
just remember while your bashing the entitlement gen. who their parents are = boomers
also guess what generation most likely owns the businesses the illegals are working for = boomers
guess what generation writes and enforces the laws = boomers
so the boomers spoil their children. don’t pay them enough to afford that lifestyle. hire illegals to do it cheaper cutting bottom line for more profit to spoil their children more
I’m not part of the entitlement gen. i still dig for a living
Clot 176,
You’re on the Mexican side of the Rio Grande. You’re about to walk over. At that moment, do you think of yourself as a criminal? Do you even think you’re doing anything wrong?
Exactly. We as a nation have done nothing to make them think they are not welcome here or shouldn’t come here without a stop at their friendly neighborhood US consulate first. We’ve left that border wide open and when, after 10-15 years and some 15 million Mexicans have crossed, we suddenly wake up and go WHOA! As if we didn’t know it was happening all along. If they’re criminals, we’re complicit in their crimes. We enabled it. To turn around now and say we’re going to punish them for their ‘crimes’ is hypocritical, unless we plan to punish ourselves too. We left that border open. We let them drive. We let them work. We patronized restaurants where we knew they worked. We bought houses we knew they worked on. We buy produce we know they worked on. The list goes on. We, as a society, have known for a long time that they’re around and we’ve accepted that for a very long time. If a crime has been committed, we enabled it.
“Who can’t get a mortgage now
Buyers with good credit and a down payment will make out well – all others, prepare to pay”
http://tinyurl.com/225xl8
This person is putting out propaganda:
“Not only is it nothing to worry about, it’s an absolute positive,” said Loni Graiver, president of the Maine-based Cumberland County Mortgage. “Not only have [home] valuations come down, but [interest rates] are still historically low.”
SAS
SAS [189],
I agree. The only other option is to go back to the late 70’s. It’s either weimar {Clot, you hit the nail on the head) or hard times. The dilemma, how to you cure the beast with the same tonic that resulted in this credit bubble? This splurge was much worse than the 20’s, 87, and dot com.
Loni Graiver website:
http://www.cumberlandcountymortgage.com
A trumpet for this industry.
Can we get some fair and balanced reporting sometime?
Reminds me of the Titanic…
SAS
Keep in mind:
Propaganda is to a democracy as what violence is to a dictator.
;)
SAS
Clot [173],
You should be more concerned with the forces in Flushing. You have to first get out of the NL Least and then look forward to the NL Lest.
Just wondering if Bi/Troll/any other folks predicting positive things for the RE market would care to response to this quote from the above NYT link:
“In the last 60 days, we’ve seen a substantial reduction in mortgage availability,” said Robert Barbera, the chief economist of ITG, a brokerage firm. “That in turn suggests that home purchases will fall further. Rising home prices were the oil that greased the wheel of this engine of growth, and falling home prices are the sand in the gears that are causing it to grind to a halt.”
JB [182],
It really is frightening. I know we have been saying this for awhile but this is a much larger concern, at least to me, than buying at 30% off 2005. With the pension shortfall, not unlike corp and other public pension plans, they have been moving $ into “higher” yield asset classes. Wait until we hear about this blowup from Trenton.
We know Booyaaa left Listen in Miami, after the Super Bowl. What did he do with Donald?
Just for fun(?) after reading this whole thread about immigrants/aliens contrasted with the odd post about sports, I looked up the combined payroll of the Mets. Over 115M for 2007. What does that say about this country?
You’ll be the first to whine here when a head of lettuce costs $6 at your local ShopRite.
Nonsense. I’ve done the ‘ditch-digging’ thing when I was younger, and certainly didn’t make lots of money. The whole “they do jobs Americans won’t do” is ignorant and racist.
Hypocrite.
I’m a “hypocrite” because only in your mind did I issue a complaint about the price of lettuce?
Yet another in the long line of your straw man parade.
Renters have to be happy with the flood of articles this weekend about how nobody can get loans. This is because renters have been saving on the sidelines for the last few years, and will not get into the market when ready.
Friend just bought a STUDIO in NYC for 695k. Great area in the village/soho. I wondered what type of loan he got and the answer: I/O for the first five years. He’s in finance, so let’s hope he keeps that job.
In the burbs, it’s becoming increasingly difficult to buy homes in the 700-800k range … even WITH 20% down. Because you still have to get a jumbo loan. Within a year, these houses may be getable for 500k, and with 20% down, no jumbo is necessary.
Sugee #165, quite the sob story. How arrogant and callous that America has immigration laws!
If they want to come to America, they can apply at the local consulate.
Know what happens to illegal aliens caught in Mexico? Instant deportation.
#158 et al: Illegal immigration is about law enforcement exactly to the degree that speeding on the turnpike is; there are token, high profile efforts in place to give the appearance of law enforcement, while larger forces condone/encourage illegal behavior.
For example, as a supposedly law-abiding society, we could easily install radar detectors and cameras to instantly tag everyone going over the speed limit; we could make sure all new cars have limiters to not exceed 70mph (or, at a minimum, strip the 130click speedometers from cars); we could, by doing so, do away with most of the gun carrying cops paid to patrol the roads looking for speeders. Speeding would end overnight, and traffic fatalities would see a significant drop.
But we don’t do this, despite the fact that cars kill 40,000 people a year (the leading cause of death among teenagers), because it would be initially expensive (though long term much cheaper) and because this automated, secure approach would derail the Zane grey “hunt the SOBs down!” fantasies of armchair cowboys, typing away at a computer in the most urbanized state in the union, who would see such actions as an encroachment on “freedom!” and further evidence of a sinister guvment plot.
Immigration policy is exactly the same; token efforts in the guise of border patrol agents toiling away at an impossible task (how many miles of border are there with Mexico & Canada, including Alaska?) while the larger society, through its economic policies, practically begs for illegal workers.
To the degree that this economic policy is largely a conservative instrument (free market) I’d argue that it IS a conservative issue, but generally agree that it’s bipartisan, because almost everyone is suckling from this tit.
So, if ignoring and not enforcing laws are making the country fall apart, and if public health is any concern at all, the most fruitful investment would be automated radar detectors (since the cameras are mostly there) on the turnpike – this will stop speeding (one of the most ignored laws in the country, much more blatant than illegal immigration) and eliminate the overhead of 90% of the troopers. I’m confident as a law-abiding citizen you stay within the speed limit at every moment, so it shouldn’t affect your lifestyle.
As I alluded to in my initial post, and as a person who’s been working in the private sector over 30years, since I was teenager, to support myself and my family, I’m much more sympathetic to the plight of a person who’s struggled to come here and work a minimum wage (or less) job, at odds much worse than mine, than the spoiled, hypocritical cries from a landed gentry who’s livelihood comes from a government handout (either welfare, some white collar porkbarrel fraud, or ridiculous public pension far beyond anything actually earned) and who’s “lifestyle” is dependent on the very immigrants they scorn.
This infantile, unsympathetic chorus will find itself bleating to the wind, surrounded by crumbling nothingness (ala Upstate New York) as youth and opportunity beat a path to a different land. And while a quiet, dead end void may be the land of their dreams, it’s a lot closer in spirit to a cemetery than the United States of America.
sugee #165
the “distanced” and the “othered” are actually doing pretty well here, that’s why they come.
They are doing better than most lower income American citizens, because they know what survival actually means when there’s no government-sponsored safety net. They’re out there working there butts off instead of waiting for someone else’s largess.
The market for their services in this area is paying them competitive wages, it is definitely not a pittance.
There is some exploitation, but I’d venture to say that there is exploitation of the unwitting American citizen as well.
Every century and every few decades, it seems, America has to go thru the very same old debate. For cryin’ out loud, the Irish weren’t even considered “white” back in the day…and they spoke English! “No Irish” need apply was as frequent as “No Italians allowed” in the early 1900’s. Let’s not even talk about the lack of acceptance to the Jewish thru the history of America.
You don’t even need to read a book, simply Google it and you will find that WASP’s intellectuals at the beginning of the century declared that “Mediterranean” people would never assimilate.
It is only fair for Hispanics having to endure the same process as previous generations. Low IQ natives are threatened by this new wave of “illegals” because they have to compete for the same jobs. But think about it. Why would anybody in their right mind hire a high wage WASP when an Ilegals can do the very same job for a much lower wage? It is capitalism 101.
If history is any guide, America is much wiser than many of its inhabitants and will continue to accept its new sons with open arms. The future of the Hispanic in America is the same as of the Irish, Italian and German: they are here to stay. (In fact, here is another fact for the nativists. Unlike African Americans, the Latino is marrying white. The number of white males available for marriage is rapidly decreasing because they are turning gay).
God bless.
#187 Pat
‘I know that’s a California article. But just remember back. A year ago. Maybe when you went to look at an open house in 2005. Did you EVER think you’d read an article like that?
Clicking on the Orange houses and getting the mortgage data. It’s like Zilloclosure.’
I read that article on your link, and it stands out as the beginning of what’s to come.
It raises the question – What will happen with all the houses that cannot be sold, before and after foreclosure? Some disinterested and irresponsible owners will choose a renter scenario that will ultimately be destructive for the block and neighborhood, as described in this article.
I was watching a show on CNBC on Friday that had a panel talking about the mortgage crisis, and how it affects Wall Street. A Wall street investor blamed the subprime market for ‘infecting’ Wall Street.
That made me mad. Just how much did they profit from it in the first place?
#200 BC – Re: NJ Budget problems
Agree! I have a larger concern about property taxes than the cost of a house. Even if I paid an inflated price for my house, at least I would know what my future bills would be – but with these growing fiscal problems in NJ, there seems to be no end in sight to the increasing burden on the taxpayer. Sometimes I ask myself, do I really want to become an owner in this state? Why would I want to tie myself to all these problems?
Re: Price of lettuce:
Why don’t you ask the moms of the kids shot in Newark how they feel about the price of lettuce. I think they paid a pretty high price for some cheap produce.
Unrealtor 202 and 204,
“they do jobs Americans won’t do”. No, not ‘wont do’ or ‘cant do’, but ‘dont want’.
I am just making objective observations. I am not indicting anyone here – the middle-class, the government or the illegals. Under-classes do unskilled jobs that generally anyone CAN do but generally DONT WANT if they can have it any other way.
I am not saying US should or should not open the borders. But as someone else pointed out they did (open) knowingly and with a purpose, and they will close when there is no purpose. The purpose being having people to do jobs the rest ‘dont want’, at least for the time being, because citizens and legal residents have been able to move beyond these jobs. And since such people have been kept undocumented, unprotected and most importantly, alienated, they can be deported at will, without much oppostion from the usually annoying, bleeding-heart middle-classes, when citizens and other legal residents want these jobs for themselves.
In India too, the borders with Bangladesh is kept open to allow illegal immigration of comparitively lower-cost labour. But when people find out terrorists and/or terrorist- sympathisers are infiltrating, there is pandemonium everwhere. But it is not just the government to blame, but everyone that employs these illegal immigrants for whatever reasons – more hard-working, less expensive, whatever.
Long time reader of this site, first post. It’s good to see that so many others have perspective.
Local observation this weekend: We visited the West Orange Matzel & Mumford/KHOV development for the first time in October on a sunny Saturday afternoon. We could not get a parking spot in the lot, the model homes were packed, and we could not even get the attention of an agent to ask abut incentives. (We are not shopping, we are waiting out the implosion but were curious.) We stopped by again yesterday, beautiful sunny day. And we were the only people there other than the employees. . .
BTW the prices are completely insane. $700-900k for townhouses, plus $15-18k in taxes and $400/mo for association fees. Maybe they appeal more to people who can’t do math.
“There is some exploitation, but I’d venture to say that there is exploitation of the unwitting American citizen as well.” – Profuscious 206
Agreed.
“The future of the Hispanic in America is the same as of the Irish, Italian and German: they are here to stay.” Happy Camper 207.
Agreed. I see doctors advertising that they speak Spanish, afterall even illegals need to see doctors. The business world foretells what is to come. US is perhaps heading toward bi-lingualism, and hey, why not, bilingualism is good for the brain.
“Citigroup seen taking $700 million in credit losses”
Not a fan of this company. But, I don’t think 700 million is that much of a big deal to this company. I could be wrong.
Then again, I would love to see these guys get brought to there knees.
sas
“A Wall street investor blamed the subprime market for ‘infecting’ Wall Street.”
[210],
Like blaming your hangover on the bartender who was serving fee drinks all night.
That’s free drinks.
GOLD baby, GOLD!!!
Central Banks are dumping, yet the yellow metal rises!!! Yeah, baby!! Yeah!!!!
I hope you all cashed out when you had the chance, who is the nut now?! ha ha ha!!!!
Ahem, excuse the maniacal outburst. Nothing to see here, move along, move along…
205
You have a very autoritarian view.
Government’s legitimacy rests on consent.
I shudder to think of the stupid results that will ensue when your automated traffic monitoring begins. Yesterday I drove back from Ithaca. Much of the way the speed limit on the empty freeway was 55. No one obeyed the law because it is stupid.
If I was an iconoclast I would agree with you.
A townhouse in West Orange for 700k? Here’s what i don’t get, and probably never will: If you can afford something that is 700k, why wouldn’t you just buy a house?
I know new construction is amazing and all … Oh well, to each his own.
Sync – #193
Absolutely spot on.
Reagan was in favor of allowing them over the border way back when because as he said, the fruit was rotting on the trees in New England because there was nobody to pick them. Plenty of American owned, American based businesses benefit from the cheap labor.
If the US has such a huge need for cheap labor, then close off the border first (duh) and then work out how to legalize those on this side of it. After that, allow more low income workers to immigrate legally every year – an immigration lottery from Mexico would suffice – and they can come and pay their dues so their kids can have a better life, just like other generations of immigrants.
And remember, we have an aging population and not enough young workers paying into the system to cover their soon to be overwhelming SS benefits and Medicare costs. The boomers did not have enough kids to balance the population. Increased immigration, especially of younger people with young kids, is an absolute necessity to fix that imbalance.
BC Bob Says:
August 12th, 2007 at 12:50 pm
“A Wall street investor blamed the subprime market for ‘infecting’ Wall Street.”
Exactly.
Un (202)-
“The whole “they do jobs Americans won’t do” is ignorant and racist.”
The above statement is also a well-documented fact. If Americans (well-paid and taxed) would hold these jobs, the illegals wouldn’t be here doing them. If American businesses would pay a decent wage for these jobs, Americans would step up and take them. The jobs are there, and the illegal labor source found them.
As to the rest of your post, sit on it sideways.
Happy (207)-
Some squirmy-making truth in that statement.
BC Bob #215
‘Like blaming your hangover on the bartender who was serving fee drinks all night’
Exactly! – to your response :)
I’ve been tracking Pway inventory on GSMLS under the assumption that inventory level trends in GSMLS will be somewhat close to what they are in middlesex mls…
Inventory level in the 300-500k price range in Pway is down about 10% in the last month. Still 36% higher than what it was in early March though. I take these measurements every weekend.
Such a viseral exchange here between you guys. Both of you normally reserve that for me. You guys really don’t like each other do you?
Let’s play nice now; shake hands and make up!
Clotpoll Says:
August 12th, 2007 at 2:40 pm
Un (202)-
“The whole “they do jobs Americans won’t do” is ignorant and racist.”
The above statement is also a well-documented fact. If Americans (well-paid and taxed) would hold these jobs, the illegals wouldn’t be here doing them. If American businesses would pay a decent wage for these jobs, Americans would step up and take them. The jobs are there, and the illegal labor source found them.
As to the rest of your post, sit on it sideways.
subprimed pension funds
State pension funds fear sub-prime mortgage fallout
http://blog.cleveland.com/metro/2007/08/state_penion_funds_fear_fallou.html
clot:
What is your opinion as to the specific cause of Hurricane Clot in NNJ? Why now and why so extreme?
Dear Steve,
I recently bought a new home and moved in less than three months ago. Since then, the builders have dropped the base purchase price by more than 15 percent on other homes in my subdivision! I am furious. Is there anything I can do about this?
— Bob L.
http://tinyurl.com/23o2jk
DOAH!
WickedOrange #229,
I suspect you’ll do more homework next time.
Ouch!
ChiFi (228)-
Fundamentals (lousy) married to public sentiment (justified or not). A real estate version of the perfect storm.
The subprime story began to exponentially intensify when it became clear that the virus was spreading into higher mortgage classes. All of a sudden, the press had a hook line they could flog like a gubmint mule.
Then, all those fence-sitting buyers got the bright idea that sellers could either be lowballed or waited out. Low sales volume dropped even lower; buyer sentiment has now ossified into a collective will of iron.
Once sentiment drives sales volume into the toilet, the rout is on. Every bust forms differently- and for different reasons- but they all end the same way: as a slow-motion train wreck.
sap [215],
Just take it in stride. Don’t boast.
That said, wait until this market gets going. I’m not saying this because I’m a perma bull, I’ve been selling calls for the last 20 years. Then again, I was long RE [physical], during this time frame. The gold market has absorbed everything, cb/ppt sales, “lending”,[how do you lend more than you own] and is still up over 100%, physical, since 2003. Futures, [leverage], Ruthian.
Unlike the U.S. dollar, which can be created at the speed of light, the available supply of gold
is finite and is painfully slow to change. Of course it sits and doesn’t do anything until it does. You can’t print gold the way you print paper money. And you can’t just build a gold mine the same way you might build a Starbucks almost anywhere, basically overnight.
When the rush for the lifeboats begins in
earnest, the upward pressure on gold will be unimaginable. Now? Of course not, all the hedgies were forced to sell to meet margin calls. Also, it’s the only thing that is keeping Spain afloat.
Many will ignore the onslaught and do nothing. That’s OK, these are the same toads that are still holding dot.bomb and RE 2003-2006. I guess do nothing and watch Larry Crude-Low and pray for Goldilocks or position yourself for a move bigger than dot.com or RE. Your choice.
ALL DISCLAIMERS.
Clot [232],
Kind of like the scenario painted by the LOD’s?
Is Boooyaa really Listen, who is now Donald?
I think one of the reasons that the government has paid a blind eye to illegals is that they have reduced the amount of inflation, particularly in food products.
You could get US citizens to pick crops but you will have to pay them 20$ an hour to do it, driving up prices.
One of the unintended consequences of this is the soaring costs of health care, which has had to absorb the immigrant burden.
August 12th, 2007 at 2:40 pm
Un (202)-
“The whole “they do jobs Americans won’t do” is ignorant and racist.”
The above statement is also a well-documented fact. If Americans (well-paid and taxed) would hold these jobs, the illegals wouldn’t be here doing them. If American businesses would pay a decent wage for these jobs, Americans would step up and take them. The jobs are there, and the illegal labor source found
Let’s not forget what Howard Johnson said about the new immigrants.
“I will give some land to the niggers and the chinks… but we don’t want the Irish… Ahh prairie $hit ..everybody!”
“You know, Nietzsche says… Out of chaos comes order.”
H, Johnson
The “they do jobs Americans won’t do” statement ALWAYS leaves out an important phrase. It should read “they do jobs Americans won’t do for the wage the employer wants to pay.”
And there’s an important implication which is always ignored by the pro-illegal crowd – the LONG TERM effect.
Since employers can hire low wage human capital, they have no incentive to invent a better way of doing things. If the cost of picking lettuce got very expensive, for example, machinery that could do it for cheap would suddenly be developed. Sure Cesar Chavez would scream bloody murder but too bad. It’s called PROGRESS.
Before slavery was abolished, the SOUTH figured they couldn’t get by without very low cost means of production. And we all know how that prediction turned out. I see little difference between that argument and that of today’s pro-illegal advocates.
Nope. Importing massive amounts of poverty is not the way to international competitiveness in the 21st century. I call it national suicide. And it’s certainly not progress.
Progress, people. It’s something you ought to think about.
The “they do jobs Americans won’t do” statement ALWAYS leaves out an important phrase. It should read “they do jobs Americans won’t do for the wage the employer wants to pay.”
Americans never did those jobs to begin with. Back in the day before cheap illegal labor people mowed their own lawns, did not have maids and watched their own children. Middle class people can’t afford to pay other middle class people to do these things. In fact I think illegals tear at the social fabric of america. I have two neighbors who moved in over a year ago. Both are against my property line, never met them. Both work sunup to sundown and have their kids in cheap daycare, have illegals maids and illegals mow their lawn, one even uses PeaPod.com. My older neighbor on the other side we talk all the time, I see him working on the lawn, I see his kids riding bikes, I say hi to his wife in the supermarket. The illegals are turning my neighborhood into an NYC apartment building where nobody talks to each other
John: How do you KNOW they’re illegals, and not just furriners who don’t speak your language?