From the WSJ:
Fears of a Recession
Spark a Global Selloff;
New Pressure on the Fed
By E.S. BROWNING in New York, ALISTAIR MACDONALD in London and JONATHAN CHENG in Hong Kong
January 22, 2008; Page A1
A world-wide stock selloff suggested that recession fears are spreading beyond the U.S., and that the downturn in U.S. markets is dragging down share prices abroad.
…
American investors have shifted billions of dollars abroad in hopes that booming economies in Asia and Latin America would shake off economic woes in the U.S. and keep the world out of recession. But the drop in foreign markets is stoking worries that no stock market will be spared. This morning in Asia, major markets opened broadly lower.The unraveling markets are boosting the pressure on Federal Reserve Chairman Ben Bernanke to slash interest rates to counter the threat of recession in the U.S. Fed policy makers meet next week, and it appears almost certain they will cut the central bank’s short-term rate target, now at 4.25%, by at least a half percentage point. Officials will likely give close consideration to a three-quarters-point cut.
A cut before then isn’t considered likely, but can’t be ruled out if markets suffer badly. A rate cut just a week ahead of the Fed’s meeting would deliver only a modest additional boost to the economy and could risk looking panicked.
From Bloomberg:
U.S. Economy May Be a `Shock’ Away From Recession, Lehman Says
The U.S. economy may be “one shock” away from a recession, Lehman Brothers Inc. said, pointing to the global slump in equity markets as a possible “tipping point.”
Lehman sees the odds of a recession in the world’s largest economy at 40 percent, rising from a “1-in-3 chance” at the beginning of the year, Paul Sheard, Lehman’s global chief economist, said in a press briefing in Singapore today. A global decline in stocks has wiped more than $5 trillion from equity markets this year on concern world economic growth is faltering.
The odds “may be edging higher even as we speak,” Sheard said. “We see a prolonged period of slow growth. We’re not expecting a recovery in 2009.”
Goldman Sachs Group Inc., Morgan Stanley and Merrill Lynch & Co. are forecasting that the U.S. will slip into recession this year for the first time since 2001 amid fallout from the subprime mortgage crisis. The world’s largest banks and securities firms have announced more than $100 billion in debt writedowns and loan losses after the collapse of the U.S. subprime mortgage market.
…
“Are we seeing a financial shock now developing which, as kind of a self-fulfilling prophecy, could tip the U.S. economy into recession?” Sheard said. “It’s a little bit too early to pass a verdict on the equity-market meltdown, but we would be looking at market developments.”
…
“We see the housing recession and the credit market dislocation continue to work their way through the economy,” Sheard said. “We see them as slow-moving shocks, a series of body blows that keep coming one after another, rather than a knock-out punch.”
All eyes on the markets this morning.
From the WSJ:
Selloff Extends Into Second Day
By MOHAMMED HADI and ROSALIND MATHIESON
January 22, 2008 5:35 a.m.
Asian stocks came under relentless selling pressure for the second straight session Tuesday, a day after fears that the U.S. economy will slip into recession triggered a sell-off that spread to Europe and Latin America. Several regional markets hit multiyear lows.
The Nikkei 225 in Japan closed down 5.7%, its lowest level since September, 2005. Shares in Hong Kong lost 8.7%, while stocks in India plunged so quickly that the Bombay Stock Exchange halted trading.
“The falls are starting to reflect a big fear factor out there. There is a sense of panic among some investors. They simply want to be out of this market,” said Macquarie Equities investment director Arthur Lim.
From the WSJ:
Stocks in Europe, Asia
Hammered by U.S. Woes
More Downside Seen
Amid Recession Fears;
‘Panic Out There’
By ALISTAIR MACDONALD
January 22, 2008
Following Asia’s battered lead, European shares tumbled to some of their worst losses since the Sept. 11, 2001, terrorist attacks, knocked by worries the global credit crisis has much further to play out and that its ultimate effect will be a U.S. recession.
For investors, there were no havens yesterday as shares, bonds and commodities declined. Companies normally seen as defensive, such as utilities, were whacked lower by the daylong rout.
“It does feel like there is panic out there, and there is little sense that it is bottoming out,” said Lucy MacDonald, chief investment officer of global equities at RCM Ltd. in London. Ms. MacDonald, like many market players, believes that the falls are likely to continue until at least the end of this week and interest-rate cuts will be needed to pick markets up.
From Reuters:
Wall St futures fall, point to further sell-off
Futures on leading U.S. stock market indexes fell before the start of Wall Street trading on Tuesday, signalling that American shares would join the global equities sell-off.
Cash equities markets in the world’s largest economy, seen by some analysts as teetering on the brink of recession, are due to resume trading at 1430 GMT having been closed on Monday for Martin Luther King Day.
“All eyes will be on the U.S. market’s performance today,” ABN AMRO said in a note. U.S. equities tend to set the pace for many other stock markets.
Speculation of a rate cut by the Federal Reserve before the next scheduled Fed meeting appeared to provide a sliver of support, lifting the U.S. stock index futures from early morning lows although they remained deep in the red.
Big sale today! Time to load up. Should be interesting around 3:30 or so.
All disclaimers.
Isn’t it funny how “analysts” missed wall street losses? All these “big swinging dick” types, after not noticing the 2000 tech bubble, were completely blindsided by the mortgage mess and all that goes with it.
Meanwhile, internet trolls employing such tools as “math” and “common sense” saw this coming for months if not years.
Great results from BoA this morning. Preliminary reporting from MarketWatch:
BANK OF AMERICA QUARTERLY PROFIT FALLS 95%; TRADING LOSSES TOTAL $5.4 BLN
From MarketWatch:
Wachovia net income down sharply on $1.7 bln valuation loss
Wachovia said fourth-quarter net income declined sharply to $51 million, or 3 cents a share, from $2.3 billion, or $1.20 a share in the year-ago period. “Lower earnings largely reflect the effect of continued disruption in the capital markets,” the Charlotte, N.C. lender said. Wachovia reported net valuation losses of $1.7 billion as well as a provision for credit losses of $1.5 billion, which exceeded net charge-offs by $1 billion. Analysts expected Wachovia to earn 33 cents a share, on average.
What year is this 1987 ??? woow ..not looking good …nor looking good at all :(((
Let’s see if Benny Boy shares the sentiment.
From MarketWatch:
ECB’s Constancio: policy doesn’t react to stock mkts
European Central Bank governing council member Vitor Constancio said Tuesday that the recent sell-off in equity markets wouldn’t necessarily change ECB policy. “Monetary policy doesn’t react to the stock market, but of course we assess what’s going on in the real economy,” he told Dow Jones Newswires on the sidelines of a conference. Some European share markets posted their heaviest losses since Sept. 11, 2001 on Monday amid growing worries about the strength of the U.S. economy.
Its going to be another sad day in the stock market. Today we will see close to a 300 point drop in the market. I go the inside tip from some friends that you can hear the fear in the trader whining this morning. We are in for another bad week on the street
buckle up, it’s gonna be bumpy.
sl
From the WSJ:
Bank of America Reports
Sharp Drop in Earnings
A WALL STREET JOURNAL ONLINE NEWS ROUNDUP
January 22, 2008 7:25 a.m.
Bank of America Corp. reported sharply lower fourth-quarter profit, hit by the credit crunch and the slowing U.S. economy.
The company reported fourth-quarter net income of $268 million, or five cents a diluted share, compared with $5.26 billion, or $1.16 a share, a year earlier, as its provision for credit losses climbed and it posted a $1.99 billion in net charge-offs. The quarter included results from LaSalle Bank, which Bank of America purchased on Oct. 1.
“Our fourth quarter results were severely impacted by ongoing dislocations in capital markets and the slowing economy,” said Kenneth D. Lewis, the company chairman and chief executive officer, in a statement. “Even given that environment, we certainly are not pleased with our performance. However, we are cautiously optimistic about 2008, though we believe economic growth will be anemic at best in the first half,” he said.
In the period, the company reported trading account losses of $5.44 billion, compared with profits of $460 million a year earlier, which were driven by writedowns of collateralized debt obligations and weaker trading results.
BofA….has no business acquiring anyone — they are run by incompetents — and on the bright side! Brady may have foot injury
Foxborough, MA (Sports Network) – New England Patriots quarterback Tom Brady was photographed on Monday with what appeared to be a walking boot on his right foot.
The photograph, shown on the Boston Globe website, was taken in New York City and credited to INFphoto.com. The paper states that Brady did not directly answer when asked about a potential injury during a radio interview on WEEI in Boston. Though, the quarterback did say he would be ready for the Super Bowl.
Besides the photograph, there is also a video on TMZ.com of Brady seemingly walking with a limp as he and girlfriend Gisele Bundchen head into a New York city apartment.
Brady went 22-of-33 for 209 yards with two touchdowns and three interceptions in a 21-12 win over San Diego in the AFC Championship on Sunday. He was sacked two times.
It’s 7:30, shouldn’t Paulson be broadcasting from Davos by now?
Everybody calm down. If the Dow and S&P come in, as indicated by futures, it’s a freaking 4% drop. There are media and TV trucks all over this street. You would think it was 1929. What’s all the damn hoopla. Wait until the real shoe drops. This is nothing.
He is hiding under his desk…the rest of the world is throwing their continental breakfast at him.
BC…they are looking for ‘jumpers’…
Paulson is not going to Davos. He cancelled his trip to work on the stimulus package
From Reuters:
National City posts $333 million Q4 loss
National City Corp, a large U.S. Midwest regional bank battered by the housing downturn, on Tuesday posted a $333 million fourth-quarter loss, hurt by mounting credit losses and write-downs.
The loss for Cleveland-based bank was 53 cents per share, and compared with a profit of $842 million, or $1.36 per share, a year earlier.
Cleveland-based National City said it was hurt by credit losses and the declining value of its portfolio of risky subprime loans. The bank also recorded a $181 million goodwill impairment charge associated with the mortgage business.
We cashed out of the stock market last year and put that money into buying a house. Although we may have overpaid, we still have a decent house with an affordable 6% interest mortgage 30y fixed. Our emergency fund is in a high interest savings acct…as long as we have health and employment I am happy
“BC…they are looking for ‘jumpers’…
Essex,
I was thinking about that this morning. On the way to the office, I walked in the streets. Didn’t want to get in the way, just in case.
# BC Bob Says:
January 22nd, 2008 at 7:35 am
Everybody calm down. If the Dow and S&P come in, as indicated by futures, it’s a freaking 4% drop. There are media and TV trucks all over this street. You would think it was 1929. What’s all the damn hoopla. Wait until the real shoe drops. This is nothing.
BC, what is the ‘other shoe’?
bloodbath,
The shoe that is much heavier than 4%.
clot: I replied on the other thread :-)
BC: Size 12 workboots?
sl
Grim – I wish you could spread discussion more –
TWO VERY CONTrovesial pieces – one on Weicherts lobby and one on suing your realtor..
“Isn’t it funny how “analysts” missed wall street losses?”
I’ve said it before & I’ll say it again:
You can’t trust Wall St. analysts. They serve 2 masters. The banks and the shareholders.
SAS
#24 Agreed. We’ll know it’s serious when the veteran 50year old plus guys who have been through this before start staggering around with glazed looks on their faces. Until then, it’s just show biz.
Credit default swaps, not today though the PPT won’t allow all the bad news to hit at once.
Once the CountyWide deal unravels we should hear a very loud toilet flush signaling the selloff.
Where can I hide my Gold so the Treasury agents cannot find it?
SAS [27],
One master. They could give a f*ck about shareholders. It’s my bonus, screw the shareholders.
So now it the RE brokers to start feeling some pain.. Feeling Misled on Home Price, Buyers Sue Agent http://www.nytimes.com/2008/01/22/business/22agent.html?_r=1&hp&oref=slogin
Spin the positive, rebate checks are coming. However, not for all.
BC Bob – Over/under guess on when the Dow dips below 10000?
I guess Memorial day.
“Weichert in panic mode”
I got an idea for Weichert, how about getting your clients to lower their prices to affordable levels?
Paulson on TV saying housing correction was inevitable and he still has belief in the global markets. Now just touting stimulus plan.
Not sure what he’s trying to accomplish right now. This isn’t anything we don’t already know.
21………excellent news. Enjoy!
i bet you .75 % cut emerg rate pendig ???
Paulson on TV saying housing correction was inevitable and he still has belief in the global markets.
maybe we should tell sellers???
Some humour on a gloomy morning
Hey – load up on Old Cents and Nickels: they are already worth about double as metal – SO Dollar is Real Asset backed currency. Well Cents are…
1909-1982 Cent (95% copper) * $0.01 $0.0207125 207.12% (twice as valuable – so US dollar is Undervalued!!!)
Funny Piece:
http://competitivenotes.blogspot.com/2006/12/horde-your-coins.html
Can I have my salary in Nickels, Please?
Meanwhile BofA decides to borrow the money to buy Countrywide from John Corzine. Corzine not available for comment, but an aide called the deal a ‘no brainer’.
.75 pt. cut
FED lowers 75pts
hay I called it FIRST ,,,,thank you thank you thank you …DRINKS pls
75 bps, nothing to see here, move along.
There you go, 75 point cut
75bps emergency rate cut? They couldn’t wait seven days until the scheduled meeting? This is absolute panic.
Wimps. They’re just prolonging the inevitable.
Renting – looks like we were eight last night on the cut
“This is absolute panic.”
Bingo. What happens when we cut to zero and we are still in a funk. Negative rates?
So the bigger problem is lending out cheap money .So what’s the answer ??? make money cheaper of course
This article just cheered me up.
Wall Street set to plunge
Wall Street is expected to plunge at the opening bell today, extending huge losses from last week. Indicators show the Dow will fall by about 500 points when trading begins, the sharpest drop at the open for U.S. stocks since the first session after the 9/11 attacks. World markets also are plunging as traders fear the United States is headed for a recession.
From the Fed:
The Federal Open Market Committee has decided to lower its target for the federal funds rate 75 basis points to 3-1/2 percent.
The Committee took this action in view of a weakening of the economic outlook and increasing downside risks to growth. While strains in short-term funding markets have eased somewhat, broader financial market conditions have continued to deteriorate and credit has tightened further for some businesses and households. Moreover, incoming information indicates a deepening of the housing contraction as well as some softening in labor markets.
The Committee expects inflation to moderate in coming quarters, but it will be necessary to continue to monitor inflation developments carefully.
Appreciable downside risks to growth remain. The Committee will continue to assess the effects of financial and other developments on economic prospects and will act in a timely manner as needed to address those risks.
Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Timothy F. Geithner, Vice Chairman; Charles L. Evans; Thomas M. Hoenig; Donald L. Kohn; Randall S. Kroszner; Eric S. Rosengren; and Kevin M. Warsh. Voting against was William Poole, who did not believe that current conditions justified policy action before the regularly scheduled meeting next week. Absent and not voting was Frederic S. Mishkin.
In a related action, the Board of Governors approved a 75-basis-point decrease in the discount rate to 4 percent. In taking this action, the Board approved the requests submitted by the Boards of Directors of the Federal Reserve Banks of Chicago and Minneapolis.
Big sale today! Time to load up. Should be interesting around 3:30 or so.
All disclaimers.
So much for the buying opportunity.
Well thanks to the Helicopter I guess I’ll need to hold my SDS position a few week or so longer.
#46 grim: What happens to housing now?
If the banks can borrow from the gov’t at a lower rate than they can lend to the gov’t, then why don’t we cut out the middleman and have every man, woman and child write their bank a check?
What happens to housing now?
I haven’t seen anything that has caused me to rethink my position. Fed cut this morning clearly shows that recession is likely more probable than most think, if we aren’t there already. The Fed has abandoned its mandate of low inflation this morning.
“The Committee expects inflation to moderate in coming quarters, but it will be necessary to continue to monitor inflation developments carefully.”
Please stop your rhetoric regarding monitoring inflation. It’s actually becoming annoying. Everyone knows that you are full of s#it. Devalue, devalue, print, print, print. Then what?
150$ oil by summer….
Re: 56. Njpatient
That is pretty much what Cramer said Friday, the banks do not want a stimulus plan they want a taxpayer funded bailout and soon.
30 BC
Exactly. No one gives a sh+t about shareholders, not even the Supreme Court.
Post-cut rally on the FTSE is quickly fading.
“75bps emergency rate cut? They couldn’t wait seven days until the scheduled meeting? This is absolute panic”
yup, someone choked.
Its too bad the Fed’s #1 priority is the stock market.
get prepared for a damn near crash of the dollar.
Fed shouldn’t of lowered. They have no control. Its obvious who runs the show with those guys.
SAS
We need negative Rate !!!!
This way Banks will get paid to borrow money with taxpayers dollars ;)
“150$ oil by summer”
I’m going with $125.
SAS
I have been in the Bangalore office for a couple of weeks now. When I warned some of my colleagues here about the Mumbai Sensex bubble at 21000 they said that it’s nonsense. I swear it was like New York in January of 2000 when stocks knew had only one way to go.. UP !
Now I am watching a lot of sad faces. Called up Kotak Mahindra Securites to put in some buy orders and was told that most reps are busy chasing margin calls.
I love chaos. There’s money to be made here.
Anyone have the link to the Weichert article?
Don’t throw danish at me, but is BofA or Citi a thing to buy right now? We have some cash and the savings rates keep sinking. I know, all disclaimers apply, etc.
#57 grim I would say this massive cut confirms we are in a recession now, no doubt about it.
However, are the realtors going to spin this, and are the sellers now going to believe that all is well,and people will come out of the woodwork and start buying homes?
I am of the belief it will casue just the opposite.
PPT wake up call, stuff like Are response times normal. Any special measures in place?
throughput and traffic picture special situations or actions anticipated, CNN everyone out in front of NYSE, double the amount of armed officers, 75bp cut, I am ready to rumble.
Buy CPRE, SOVPRB, stuff like that, do the preferreds
leavingqueens Says:
January 22nd, 2008 at 8:56 am
Anyone have the link to the Weichert article?
Don’t throw danish at me, but is BofA or Citi a thing to buy right now? We have some cash and the savings rates keep sinking. I know, all disclaimers apply, etc
“I love chaos. There’s money to be made here”
one could argue we had a major pump & dump on the DOW. Someone is going to make millions today. WIsh it was me ;(
SAS
Dominion Homes (DHOM:Dominion Homes Inc
News, chart, profile, more
Last: 0.41-0.06-12.77%
DHOM 0.41, -0.06, -12.8%) , hit hard by the housing slump, agreed to be acquired for 65 cents a share.
Canada cuts 1/4
Rate cut is way too late. Nothing is gonna save the stock market from tanking.
Al 49
$150 oil was my new years prediction and i still stand by it! the current drop in prices is the calm before the storm!
njpatient Says:
January 22nd, 2008 at 8:28 am
Renting – looks like we were eight last night on the cut
Nice call!
For people who think oil is going to $150 by summer, you got to read this.
http://globaleconomicanalysis.blogspot.com/
you blokes called that one.
I didn’t see it coming. Nice call.
SAS
“What happens to housing now?”
3b,
Prices continue to decline. The housing bust lives on. Lowering rates does not unravel insolvency. The banks hoard cash, it will take banks years to work themselves out of this mess. You better have at least 20% to put down. In addition to this, your credit will have to be impeccable.
Bottom line, great for prime borrowers with cash to put down.
grim Says:
January 22nd, 2008 at 8:39 am
The Fed has abandoned its mandate of low inflation this morning.
grim: I disagree. Other more pressing matter have created different priorities.
This move is a thorough embarassment though.
Please stop your rhetoric regarding monitoring inflation. It’s actually becoming annoying. Everyone knows that you are full of s#it. Devalue, devalue, print, print, print. Then what?
Hyperinflation. It’s inevitable. Lad up on US dollar debt(short) and get your money as far as away from US Economy as possible. It’s clear we have morons running our economy and gov’t.
I’ll come back and buy the dow at 8 ounces of gold until then enjoy your ride down a very slippery slope.
“For people who think oil is going to $150 by summer, you got to read this”
I am stickin to 125$.
you blokes called the Fed cut, but so far, I think I’m 100% on calling crude.
; )
SAS
leavingqueens Says:
January 22nd, 2008 at 8:56 am
Don’t throw danish at me, but is BofA or Citi a thing to buy right now? We have some cash and the savings rates keep sinking. I know, all disclaimers apply, etc.
#1 From Queens come Kings
#2 Do not ask that question here and do not expect to get an answer worth using. Grim throw up that disclaimer.
“I’ll come back and buy the dow at 8 ounces of gold until then enjoy your ride down a very slippery slope”
There was a time you could buy the DOW with an oz of gold.
There maybe something to your comments.
Unless you flip flop on me….
SAS
Most liquid and diverse ETF to buy into weakness is the Select Sector SPDR: Financial Select Sector SPDR Fund. XLF (AMEX)
If you want to roll a dice try REM, ETF for mortgage related stocks.
yikes. is it time to move the house fund into a mutual fund? my savings will soon be yielding under the mattress rates.
BAC investment bank recorded negative REVENUE…..THAT IMPRESSES ME
Ven,
My call is $150 by december. I base my call of of supply/demand info. While there is currently a dip in prices due to the market “uncertainty”. the fundamentals of the oil field performance combined with supply/demand curves doesnt match up with oil staying at its current price
“I’ll come back and buy the dow at 8 ounces of gold until then enjoy your ride down a very slippery slope”
All disclaimers.
I’m looking at 4-5/1.
74
Agree – BB spitting in the wind
And here is another little wrinkle…
Natural gas. A large # of people in the US use natural gas for heating and it is increasingly being used for power generation. Current demand growth is expected to out stripe supply very soon, hence all of the talk and some action of building new natural gas terminal in the east and west coast. In the next 1-3 years we will see power generation start to compete with the home heating market for supply. This means prices go up,up,up. The other factor is that power generation can and has drawn down the natural gas reserves during the peak summer generation periods, so when you have cold spikes in the winter the reserves have not been replenished yet. There has not been a conflict between power generation and home heating yet, but the numbers are borderline and we could actually see this start to happen next winter, although that would be an early onset. demand conflict will most likely take another 2-3 years to start rearing its ugly head.
BC (16)-
It’s like everybody in the media is 12 years old and never saw a real market tanking, a la ’87.
“I’ll come back and buy the dow at 8 ounces of gold until then enjoy your ride down a very slippery slope”
All disclaimers.
I’m looking at 4-5/1.
This is Un-American!
kettle#92
very interesting stuff.
Wow, look at the Dow!
.75 rate cut.
So did the Fed cut make things better, or worse?
like bailing out a schooner with a thimble.
#79 BC Bob:You better have at least 20% to put down. In addition to this, your credit will have to be impeccable.
We have both. As my better half always says, everything old is new again.
OH NOES
# BC Bob Says:
January 22nd, 2008 at 9:26 am
“I’ll come back and buy the dow at 8 ounces of gold until then enjoy your ride down a very slippery slope”
All disclaimers.
I’m looking at 4-5/1.
BC Bob is a DOW JIHADIST
From the AP:
Ambac Posts $3.26 Billion Quarterly Loss
Ambac Financial Group Inc. swung to a deep fourth-quarter loss after taking a $5.21 billion write-down, and is reviewing ways to raise capital, the troubled bond insurer said Tuesday.
Dow down 441 points, we don’t need no stinking rate cuts.
Black Tuesday!
Fed is adding $10 bln in overnight repos. Not surprising.
A number of people are calling for another 50bps cut next week. Likely?
Shut down at 10 for a little 20-minute Kaffee Klatsch?
all disclaimers, watch qld
3b 55,
“What happens to housing now?”
The rich get richer. Homeowners with a lot of equity in their homes refinance their mortgages at rates in the low 5s and increase their monthly income by a couple hundred bucks with a flick of the wrist.
I think we found a bottom in Citi pref stock. Guess yields are too tempting.
9 A1/A 173066200 CPRS CITIGROUP CAP IX TRUPS 6.00% 1.500 21.250 7.164
10 A1/A 17309E200 CPRO CITIGROUP CAP XIV 6.875% PFD 1.718 23.550 7.336
11 A1/A 17306R204 CPRZ CITIGROUP CAPITAL VIII 6.95% 1.737 23.000 7.618
12 A1/A 17311U200 CPRF CITIGROUP CAPITAL XIX 7.25% 1.812 23.500 7.779
13 A1/A 17310G202 CPRU CITIGROUP CAPITAL XV 6.5% 1.625 22.100 7.413
14 A1/A 17310L201 CPRW CITIGROUP CAPITAL XVI 6.45% 1.612 22.300 7.268
15 A1/A 173085200 CPRG CITIGROUP CAPITAL XX 7.875% 1.968 25.500 7.821 7.691
Wouldn’t that be fun, but I guess I’ll have to wait.
93 Clotpoll
Everyone in the media was probably in high school or college during 87. Plus, the media will do anything for ratings.
this isn’t so bad….
alot of hype afterall….
see you tomorrow
SAS
Reuters, 1/21/08- The Federal Reserve has announced that at its next scheduled meeting, it will host a beer pong party for all its voting governors, as the need to deliberate over near-term policy has now been removed.
The location for the next meeting has been moved from the Federal Reserve boardroom to the Hooters on 7th St, NW. The public is invited, and there will be a one-day, all-you-can-drink “Weimar Days” beer special, with domestic pitchers priced at $417.
At the end of the day, a vote will be taken on further rate cuts. Wagering will begin at 1 PM.
Why do you say the rich get rich? A lot of rich people are not going to refinance, they will be like me and start banging out their mortgage as their bonds and CDs mature rather than re-roll or put whole thing in market. What will happen is the people with good credit risk will either pre-pay, some will refinance and the sludge who can’t pre-pay or refinance will be left in the MBS and you can expect a lot of defaults in non seasoned 2005-2007 MBSs in 2009.
John (114)-
“…you can expect a lot of defaults in non seasoned 2005-2007 MBSs in 2009”
Can expect those, no matter what happens in the interim.
The 450pt drop will be the sheeple orders from the weekend/holiday getting executed. The Dow is climbing back. With the rate cut we could end the day flat. We will have a better picture at noon.
“Ambac Financial Group Inc. swung to a deep fourth-quarter loss after taking a $5.21 billion write-down”
That can’t be true! bi said there would be no more writedowns!
clott 113
i say we move the GTG to the FED meeting. Could be a lot of fun!!! Are we going to be using $100’s for rolling papers in celebration of “Wiemar Days”?
The rich get richer. Homeowners with a lot of equity in their homes refinance their mortgages at rates in the low 5s and increase their monthly income by a couple hundred bucks with a flick of the wrist.
Pret,
Do you really think that refinancing makes you rich? or richer?
People are loosing their shirts on Wall Street, pension funds are getting smaller and smaller, retirement is pushed back another decade for many baby boomers and you are telling us that rich get richer.
Your savings account just robbed around 15% but you’re not smart enough to realize it.
Bah, none of the stocks I want to own more of are on sale.
For this to mirror 1987, the Dow would have to drop about 2500 points, so I’d say we have a ways to go yet. Now I am starting to see the benefits of being old; my mortgage is at 4.5% fixed on a house bought in 1993, and I moved my 401k out of stocks back in December.
108 pret
“Homeowners with a lot of equity in their homes”
Now THERE’s a small and rapidly shrinking category of people!
C $23.29 -$1.16 -4.74%
The 450pt drop will be the sheeple orders from the weekend/holiday getting executed. The Dow is climbing back. With the rate cut we could end the day flat. We will have a better picture at noon.
even if Ben dropped the rate to 1%(ala greenspan) we will not finish the day or the week on a positive note. Do you not see the earnings. We are in a recession. Our banks are crumbling, consumer can’t afford to spend, dollar is being wiped out, and you think all is well.
You can’t create wealth by printing money. I understand the ignorance of Joe six pack but I don’t understand the stupidity of people who actually work on Wall Street and make a living doing this.
” I understand the ignorance of Joe six pack but I don’t understand the stupidity of people who actually work on Wall Street and make a living doing this.”
you can say that again
make [124],
As someone said earlier, it’s all about “my” bonus. Everyone’s got their own agenda, there’s no responsibility or accountability anymore.
In the seasoning process, it takes several years and then you get to a magic point around year five where people are less likely to move, default or refinance. You end up with in year 5 with the go the whole 30 type people. However, this massive rate cut while people are in the first few years of a mortgage where refinancing or paying off makes the most sense do to mortgage payment being 95% interest and hardly any princpial you are goning to lose all the good credit risk people, unlike last time you lost the good credit risk and bad credit risk people as even a doorknob could refinance.
You will end up with people with no equity or people with poor credit left by the time Jan 2009 rolls around. Not a pool you want to be in.
Clotpoll Says:
January 22nd, 2008 at 9:53 am
John (114)-
“…you can expect a lot of defaults in non seasoned 2005-2007 MBSs in 2009″
Can expect those, no matter what happens in the interim.
124 make
I understand the ignorance of Joe six pack
and this is how we get into this mess in the first place. if they would actually teach people basic economics in elementary/highschool you might have a population that actually realizes the basic concepts of how our financial system works.
Then again that could be a bad idea, it would be much harder to sell our country to the highest bidder if the public understood what was being done
From MarketWatch:
B of A’s Lewis says Countrywide deal terms may change
B of A valuing CDO/subprime loans at 30 cts on the dollar
Card defaults in bad housing states 5 times nat’l level-BofA
B of A home equity defaults rose sharply in 4Q
#108 pret: My question was rhetorical, I guess you did not understand that. Furthermore it was geared at what will the realtors and sellers say/do now.
I see you are still living in your la-la land.
Talk about an OXYMORON as a result of realtors brainwashing everyone. If you have a mortgage YOU ARE NOT A HOMEOWNER!!!!!!!!
Remember in our parents day they burned the mortgage to celebrate paying off the mortgage and now owning the home. You are just a glorified renter when you have a mortgage.
njpatient Says:
January 22nd, 2008 at 9:58 am
108 pret
“Homeowners with a lot of equity in their homes”
Now THERE’s a small and rapidly shrinking category of people!
“if they would actually teach people basic economics in elementary/highschool you might have a population that actually realizes the basic concepts of how our financial system works.”
Mrs. patient has been saying this about once a day for the past decade
11 days ’till Tom Brady’s first Superbowl lose.
Will 30 year fixed mortgage rates get to 5% and in what time frame? Should I refinance now or wait for better rates?
lose = loss
FYI market only down 300, command center has slowed down, buying opportunity is over by 10:15am, hope you bought what you wanted.
Pandit and Thain on the road to recovery
By Heidi Moore in New York and David Rothnie
Financial News
January 22, 2008
With Citigroup and Merrill Lynch confirmed as Wall Street’s biggest victims of the sub-prime mortgage crisis, Financial News gives their new chief executives a five-point plan
Americans lose faith in Citi and Merrill
By Francesco Guerrera in New York
Financial Times
January 22, 2008
Citigroup and Merrill Lynch’s standing among US citizens has plummeted as a result of multi-billion dollar capital injections by sovereign wealth funds, according to new research that highlights simmering public opposition to investments by foreign governments.
again, homebuilders are the big winners today. this is the direct impact of 75 bps rate cut
132 patient,
I finally got frustrated enough about not understanding the markets to start reading on my own. It also help to find people smarter then you and listen. Thanks to all the people on this board who have schooled me on various subjects :)
The funny thing is that i always that that finance was dry and boring until i started teaching myself about it. Now i find it fascinating and would like to get into he field. It all seems very arcane and mysterious until you put the time in to learn a little.
make (119)-
Pret is a home-schooled 16 year-old who trolls here when Mom refills her drink (if you were glued to this guy, wouldn’t you drink?).
Besides, doesn’t everybody know that debt = wealth??? :)
I still think that todays excitement is just the beginning as we are just starting to realize that the emperor has no clothes
I am posting from Orlando this weeK and all I can see around for miles is consumption.
Joe sixpack is alive and well negative savings rate and all
The Hotels are full, the fast food joints are jumping, the dollar store parking lots are full with Minivans and SUVs.
Don’t know what all these people who live down here are going to do when Mickey starts laying off staff.
vodka (128)-
“Then again that could be a bad idea, it would be much harder to sell our country to the highest bidder if the public understood what was being done…”
Precisely. This whole thing is a conspiracy against us, from the withholding of relevant education to the Rube Goldberg financial engineering.
From middle class to slave class in one generation. And, no one will be left on the back end to tell the tale, because everyone left will be too stupid to understand it.
in re: refi
i have a close friend who bought a townhouse in august. 20% down 30yr fixed at 6.75% not bad historically. but he’s now tempted to refi with gmac at 5.75% for $399 flat. i talked him out of it because 1. $100 bucks a month payment difference does not make sense with in the first year and 2 (more importantly) the 400K price tag of his house was obviously inflated. units are now selling in the mid 300’s. so here is loan officer at gmac looking to get a quick refi to find out the original 20% equity could now be valued at 10-15% with a new appraisal. so his mortgage amount is now at 85-90% ltv, no longer 80. thus requiring mortgage insurance. so much for saving a 100 bucks a month.
When tech burst, there was a big drop followed by a lull and then it got worse. This is the first big drop and with housing weighing in on this, the fall after any lull will be much worse.
Your first loss is your best loss.
Townhomes and condos are the first to fall. The last to get hit are usually the best houses in the best locations. Those “gems” are starting to shake.
gary Says:
January 22nd, 2008 at 10:04 am
make [124],As someone said earlier, it’s all about “my” bonus. Everyone’s got their own agenda, there’s no responsibility or accountability anymore.
gary: I don’t want to sound like a cynically reflexive idiot, but there never was accountability. The easiest way to keep an even keel right now, other than not being involved, is to appreciate how wonderfully healthy all of this activity is…..we are receiving a financial enema….thanks!
kettle,
No. Just super bullish the yellow metal.
Kettle,
My post, 147, was in response to your # 101.
look at that curve, thats an impressive 2nd derivative
http://tinyurl.com/cq41
thats BC Bob, i wasnt sure what you were referring to
The stage is now perfectly set for lower asking prices this spring. The public has accepted that the economy is crap right now. The delusional people who have had their houses on the market for a year or more are going to be blown out of the water by the new comps in a few months.
#124 Make
I will take that with a pinch of salt.
I agree on the recession and the need to RAISE interest rates. But thats not going to happen for a while. Earnings will be bad for some areas and better for others.
On todays (Jan 22nd) activity. Its like the parent leaves the kids to fend for themselves for a few days and the kids throw a kegger. This has happened before. Far East and Europe crash for a few days while the US market is closed for a holiday. US opens down and then holds, Europe and Far East stabilise and all return to stable levels. This time the Fed threw in an unnesscessary rate cut that will negate the drop. It will mean no change in the FFR at the Jan 30 meeting.
Fed down 162, we may be flat by noon.
skep-tic Says:
The delusional people who have had their houses on the market for a year or more are going to be blown out of the water by the new comps in a few months.
It’s still amazing the idiot asking prices out there still. Co-worker of my wife just bought a place in Long Valley. They offered $100,000 off of $369k listing price and got it (small house). That’s the new comp for that neighborhood and price range. Northern Virginia asking prices seem much lower than they were a year ago…$100 to $150k less. The blind arrogance of realtors and sellers here still is astounding.
Of course it is all about MY bonus, what able bodied red blooded American cares about the other people’s bonuses?
BTW – Prices for bonds were rising and yields were dropping around 10:10 am of the same companies that were leading the decline in equities.
The bond market can’t be saying a company is not defaulting while the equity market is saying it will default. Both can’t be right. That 10:10am big positive corporate bond movement told you to plow into equities, well at least for an hour or two. Nice special situtation.
Yeah, baby, yeah!!!!
Life is good!!!!
Greetings, BC BOB!
Mr. Paulson & Me Bernanke, “Economic Treason”, has it’s downside, even if your friends won’t convict you.
Will 30 year fixed mortgage rates get to 5% and in what time frame? Should I refinance now or wait for better rates?
I’m at 5.625% and I just saw that banks are already down to that level. I’m hoping to get something at 5.0% or better in the coming months.
Instead of the rate cuts or helping the housing market, the government should be helping with something that effects everyone.
They should be doing something about Oil prices. I wish the prices would go back to 99 cents a gallon but thats just wishful thinking. They should take the money that they would use to help braindead homeowners who spend more than they can afford and help the oil problems.
Agleast get prices down to 1.75-2.00/ gallon.
Thats one thing that would help the encomomy.
But hey thats just my opinion
Sapes [155],
Where have you been? Farming in Argentina?
Does this rally seem a little too much too soon to anyone? Market seems ripe for another major drop tomorrow. I’m just not buying this.
I just refied at 5 3/8 no pts…
Could someone give me a history for???
18 North Gate Road,
Mendham Boro
thank you
#137 bi: And once again you are teh big silly today;and everyday.
158.Homer Says:
January 22nd, 2008 at 11:07 am
Instead of the rate cuts or helping the housing market, the government should be helping with something that effects everyone.
Small oil business owners on the radio this morning, are calling on Congress to “Close The Enron Loophole”. They estimate 40% of increase is due to speculators manipulating the market. Another classic example of “Economic Treason”, under the guise of Capitalism.
Interesting reading from HERB G…some good points.
The Fed Blinked: Now, What?
9:25:16 AM January 22nd, 2008
Permalink | Comments (8)
With news this morning that the Fed is cutting the Fed Funds rate by three-quarters of a percent, it’s official: Things are worse than they seem with the economy.
The Fed, pushed by shattered worldwide investor psychology, is pulling out all stops to shore up confidence. Treasury chief Hank Paulson went so far as to call this latest cut a confidence builder.
Trouble, as has been pointed out here previously, is the “what if they give a party and nobody comes” syndrome. In this case, what if they do a big-bath cut and it doesn’t help?
I wrote here last month that the Fed did the right thing by cutting just a quarter of a percent a few weeks before the holidays. That would give them a chance to see how the consumer was really doing.
They got the answer pretty fast: The consumer is doing horribly. The value of their homes, especially in the most inflated parts of this country, has deflated. The availability of credit via their homes or other sources has deflated. The value of their 401ks and IRAs has deflated.
As a result, their confidence has been crushed, and it’s unclear how many rate cuts it will take to reverse the trend. The trouble, away from Wall Street, is really quite simple: America has been living out of its means, fueled by a Fed that made credit so cheap that it appeared, at one point, you were getting paid to take the cash. With today’s cut, the Fed Funds rate will fall to 3.50%; last time it was that low was August 9, 2005, when the market was higher than it is today. By contrast, it sank to 1% on June 25, 2003. Mortgage rates, meanwhile, for 30-year loans are averaging 6.33%, still well above their boom levels; ditto for the prime rate.
Here’s the problem: Even if rates once again fall to boom-era levels, credit standards have tightened to the point that even a little bit of sugar won’t help the medicine go down. And don’t go thinking everybody will refinance as mortgage rates slide. Unfortunately, their homes may not appraise out. Batten down the hatches: Ain’t over yet for the bad news — or the Fed.
The beat goes on…
I bought my house last July for 370k sale price, got a loan for 296@6.375 and a home equity for 55.5k @8.2% I have made improvements on the house and one up the street sold for 440k, but in this market I am not sure what is going to happen with the appraisal. Countrywide told me I won’t be able to use a new appraisal for a year. Would another mortgage company reappraise or would they have to use the sale price? How “tough” are the appraisers?
158 homer
Unfortunately, there is little the US can do about oil prices in the short term (except releasing some of the strategic reserve and this may not have an effect). oil prices are being driven by supply and demand at this point and even if the US were to reduce the amount of oil we use, there is demand in india and china that would most likely snap up the % of oil that the US stopped using. The only solution is a long term solution to move away from oil as our primary energy source.
Forbes, Dec 2007, rated Hudson City Savings, Best Managed Bank. They don’t do Fairy Tale financing.
#162
All I could find is:
Listed 12/18/06
LP: 1,200,000
SP: 825,000
Closed 3/21/07
(Taxes 18,939)
follow up…
If I get a new mortgage for 350k @ 5% my payment will be the same as for the 294k @6.375, so that is why I really want 5%. The 350k implies I need 437k assessment to escape PMI, but I might just take the PMI and rush to get the 20% down.
“Trouble, as has been pointed out here previously, is the “what if they give a party and nobody comes” syndrome. In this case, what if they do a big-bath cut and it doesn’t help?”
this is my fear. We’ll see by cocktail hour, but if we’re down 75 bps and the djia still drops, say, 300 today, that’ll freak people out.
Confused,
That “close the Enron loophole” has been on the radio for a while.
thanks sybarite
apparently it is now banked owner with an outstanding balance/loss of 416K. I was curious as to what the back story was…..
Interesting Read on Enron Loophole;
http://www.closetheenronloophole.com/
Dow back in red at -211. the rally seems short-lived.
Whatever is green on my screen IS BIG GREEN
Got off the phone with Germany, DAX ended flat. We should end flat too, anyone buy anything today?
Homer,
The gov’t can do nothing about oil prices. It moves with supply and demand. Gas taxes could be manipulated however US taxes are very low compared to Europe and Asia. Maybe they could do some sort of artificial price cap, but that would be too Hugo Chavez-like. The US is especially vulnerable to oil price hikes because we drive everywhere and we’ver neglected our railroads for several generations. Cheap gas is partially a factor into housing prices in far-flug exurbs: buying over the PA border might make sense if gas is $1.50 per gallon but at $3 and up it makes less sense to live there and drive 70 miles each way to work.
#166
i suspect most lenders are going to scrutinize appraisals as they have been recently targeted for fraudulent values, lawsuits, etc. (BPO companies are hacking values left and right).
it’s also a good idea to wait at least a year to refi for you to cover the expenses from your purchase. take a look at your TIL and HUD documents from closing to see the actually cost of the transaction in the first year.
2 years ago you would have no problem doing what you’re looking to do. however, today’s corrections are not going to allow you to do so.
Got off the phone with Germany, DAX ended flat. We should end flat too, anyone buy anything today?
Absolutely nothing filled, if there was a sale, I missed it.
Make money 119,
“Do you really think that refinancing makes you rich? or richer?”
Should’ve been clearer in my post by stating that the current housing crisis is widening the gap between America’s have and have-nots. The richest Americans have a lot of home equity but it comprises a small part of their net worths. These folks can easily refinance at a lower interest rate and will save and invest the difference.
Meanwhile, for middle class Americans, home equity has been a large part of their net worths. The combination of increased leverage and falling home prices in most part of the country have wiped out a large part of the middle class’ home equity and net worth.
“Your savings account just robbed around 15% but you’re not smart enough to realize it.”
Can you explain this? I just checked my savings account. It is all still there. True, balance will grow slower as interest rate goes down. But extra cash from mortgage refi will offset lower interest from savings account. And savings account will enjoy future interest rate increases, while mortgage interest will remain fixed at low rate.
sybarite,
It looks like that home could be a straw deal
SP: 825,000
Closed 3/21/07
judgment: $416,409.41
EMC Mortgage Corporation
$100.00 | 7/31/06
sybarite….
hmm today i can read dates, 06/07… :(
sybarite….
hmm to bad i cant read dates, 06/07… :(
Run and hide. This is the beginning of the end.
Run and hide.
Don’t get suckered buying stocks now.
Wait until blood is on the streets.
From CNBC:
Fed Slashes Interest Rates; More Cuts Now Likely
February fed funds futures indicated a 90% chance that the Fed will lower its target for overnight rates to 3% from 3.5% at its next policy setting meeting on Jan. 30.
Your savings account just robbed around 15% but you’re not smart enough to realize it.”
Can you explain this? I just checked my savings account. It is all still there. True, balance will grow slower as interest rate goes down. But extra cash from mortgage refi will offset lower interest from savings account. And savings account will enjoy future interest rate increases, while mortgage interest will remain fixed at low rate.
Just Like I said. Your savings account just robbed around 15% but you’re not smart enough to realize it.
There is no silver bullet to this problem. A natural self correction is taking place.
Didn’t you love Paulson’s press conference? The questions came at him from his side so he never had to “look us in the eyes.” He was also jittering around like he was in a hurry to use the men’s room.
Future stock report on 1010 WINS:
“Markets opened at 12,446 today, plunged to zero in frenzied late-morning profit-taking, and rose again 12,465 points in an afternoon rally, to close up nineteen points…”
This is a re-post (forgot grim doesn’t like c*cktails):
“Trouble, as has been pointed out here previously, is the “what if they give a party and nobody comes” syndrome. In this case, what if they do a big-bath cut and it doesn’t help?”
this is my fear. We’ll see by c*cktail hour, but if we’re down 75 bps and the djia still drops, say, 300 today, that’ll freak people out.
refi (166)-
The first thing you do is take your refi app somewhere besides Countryslide. Their rates are a good 50 bps over everybody else.
Nice work fellas.
Corporate Default Risk Soars as Fed Rate Cut Signals Recession
The risk of companies defaulting soared on concern that an emergency interest rate cut by the Federal Reserve will fail to halt a worsening global economic slowdown, credit-default swaps show.
If FFR goes from 3.5% to 3% next week, we’ll be at Bill Gross’ target.
Not a good thing at all.
If you do a quick internet search you will find very competitive refi rates. I’m not going to list any bank here, but there are some out there that have very good loan programs.
That doesn’t seem to be refi’s issue. He needs an appraisal that will save him the PMI. That’s going to be a tough move in this climate. Perhaps if you had extra $ to put down with the refi?
It’s hard to express how bad the idea of buying gold as a long-term strategy (as opposed to a short-term hedge) is. Because, you know, one of two things is going to happen. Either the economy will go through its normal cycle, there will be the usual amount of pain and disruption and we’ll come out the other side intact or things will spiral out of control, the economy will collapse and we’ll have financial Armageddon, Weimar-style hyperinflation, dogs and cats living together, mass hysteria.
In the former case, goldbugs will get hammered, just like they did in the early 80’s. In the second case, you’d be better off investing your money in canned goods and spare ammo.
John (176)-
AUY @ $14.01.
All disclaimers. This just means I can eat for another month.
From cbsmarketwatch:
Talking about more rate cuts beyond 3% …down to 2.75% by April and 2% by September – YIKES!
THE FED
Fed isn’t finished by a long shot
Economists, investors are confident there’s more easing in the pipeline
By Greg Robb, MarketWatch
Last update: 11:10 a.m. EST Jan. 22, 2008
WASHINGTON (MarketWatch) — Tuesday’s surprise interest-rate reduction by the Federal Open Market Committee doesn’t mark the end of U.S. rate cuts by any means, Federal Reserve watchers say.
“Don’t take today’s move … to mean that the FOMC is through,” said Richard Moody, chief economist at Austin-based Mission Residential, in a note to clients. “We expect another funds rate cut at the scheduled January 29-30 meeting, with possibly more to come in the spring.”
Investors seemed to agree. Wall Street showed broad losses in U.S. stocks, although key equity benchmarks had come well off their worse levels of the post-holiday session.
[snip]
Fed funds futures now point to a 2% Federal funds rate by September, Fed watchers said.
“This is a recession call by the market,” said Scott Anderson, senior economist by Wells Fargo Economics.
“Our current view is that the Fed will cut another 75 basis points by the end of April, bring the Fed funds target rate to 2.75%,” Anderson said.
He said the Fed won’t be keen to move below that level in order to keep some ammunition “for a rainy day.” End of Story
http://www.marketwatch.com/news/story/fed-isnt-finished-long-shot/story.aspx?guid=%7bFE058836-414C-4CC9-8F04-866CF0AB29DE%7d&print=true&dist=printTop
Citi is down. The cut ain’t helping that one. Shoulda woulda coulda sold it weeks ago.
Chuch (194)-
Are you currently short gold?
Seriously, I do not see this as an equity buying opportunity. I would not buy anything until a couple weeks after this earnings cycle. Just my personal opinion. The only stock I have left is MSFT and that’s a sell stop about to get triggered.
Grim FYI I think you forgot to delete post 88 from your systems.
so the FED will CUT to MINUS 3.75 ??
wooow all exchangess have huge delays ,,,,poor IT folks :(((
I guess my point is yes maybe we cant do something about oil, but they should be focusing on things like oil and things that impact most Americans. The housing problems affects only some of this country.
They make such a big deal about inflated home prices, which yes is a big deal
But what about everything else thats increased
food, property taxes, sales tax etc.
I know this is the housing blog, but since we are talking about recession we need to bring everything to the table
Think about everything thats increased over the past few years.
Even if prices fall 50% of 2005 highs what about property taxes?
So even if the right price level for the bottom of the market will be 1997 prices which would put at at around 50% off 2005 highs, we still have to take into account oil price increase, property taxing doubleing and than some, price of food increase, health insurance increase etc.
So now this “1997” correct price is now wrong becuase other things to have gone up in price.
But when people make guesses about how much prices will drop or the recession it seems like they do not focus on the whole picture.
I think if people consider the fact 70% of NJ makes under 100k total household income
takes into the fact of how much gas prices, health insurance, food etc has increased
than we can have a better idea of what will mark the bottom of the housing market and the end of the recession.
Guessing and saying well people that don’t make 6 figures are doomed and wont be able to afford NJ. Hmmm so the 30% of the state has a 6 figure household income is going to buy all the property in NJ? LOL I doubt that very much.
If prices do not come down in everything than the housing market will be effected even worse. Say hello 70% drops.
Anyone who thinks different tell me why :)
Basically this rate cut is dead in the water. They can run the printing presses all they want if banks don’t want to lend and people don’t want to borrow and they are both focusing on paying off debt then the Fed has essentially become useless now that the psychology has changed.
@180 pret: And the richest Americans are a tiny % of the populatin, and most of them do nto have mtgs;we hasv had this conversation yime and time again.
You need to come donw from the attic, or wherever it is you are ensconed, and look at what is going on.
Forget your silly gold coast, come to the towns in noth and central Jersey, and you can witness first hand the amount of debt that so many people have incurred.
Every one I know, family,friends, acquatiances, co-wrokers have at least one home equity loan, and at least one lease. not to mention house cleaners and land scappers and the list goes on. And these are all college and plus educated professionals, not the so called Joe six pack. And quite a few are down righ terrified with what has been happening, they have finally woj=ken up to the fact that the party is over.
Heck I am home today, dropped in at the local CVS with my 12 year old (mint condiditon, my wife uses the paid for in cash new car)), and there was not one car more then 3 years old in the lot. (Maybe some of those scared people I know were buying packages of Depends)
This was a debt infused binge, nothing more.
Your constant richest Americans nonsnese, is just that nonsense.
It’s hard to express how bad the idea of buying gold as a long-term strategy (as opposed to a short-term hedge) is.
Church [194],
It guess it depends on your definition of long term. Does 4,5,6,7 years qualify as long term? Is it that hard to express how bad of trade it has been?
http://charts3.barchart.com/chart.asp?jav=adv&vol=Y&grid=Y&divd=Y&org=stk&sym=GCG8&data=H&code=BSTK&evnt=adv
203 homer
most of us on this board agree with you. But the only way to do what you are talking about is to get our financial house in order. Any way that the issues are tackled will cause short term economic pain and therefore the politicians do not want to touch it. We need to do things such as raise the FFR rate, balance trade deficits, stop deficit spending and fix medicare. Doing any of those will piss off a very large number of people because in the short term prices go up, benefits are lost etc.
more evidence that pret-a-poseur may not have made the correct call for 2008 in NYC RE……
WSJ
January 21, 2008, 9:18 pm
M&A’s Apocalypse Now?
Posted by Dana Cimilluca
The threat of a housing-induced U.S. recession wasn’t enough to do it. Nor was the disappearance of the credit needed for leveraged buyouts. But the global financial earthquake Monday may just succeed where other shocks failed in shaking the confidence of M&A bankers.
Bankers have stubbornly stuck to a prediction, derived we know not where, that merger deal volume would fall less than 20% in 2008. Given that last year was the best on record, such a drop still would put this year up there with the best ever for merger mavens. But even the most diehard among the suspender-and-pinstripe crowd has to be wondering if 2008 will go down as a year to forget.
For a barometer of current M&A psychology, take a look at the BHP Billiton-Rio Tinto merger dance. That deal, unveiled in early November, has been held out by bankers as evidence that, months after the credit crunch set in in June 2007, the (corporate) M&A market remains alive and well. Rio shares have fallen nearly 30% from their early December high and now trade well below where they were when the BHP offer was unveiled. Is it any wonder BHP now indicates it has no plans to sweeten its offer, as Rio has demanded?
Or how about the interest in Xstrata that Brazil’s Vale has expressed? Xstrata shareholders greeted that Monday with worse than a yawn, pushing the stock down 5.5%. (Maybe they are wondering which banks are going to pony up the $35 billion needed to get that done in this environment.) Vale shares fell 10%.
If that isn’t enough to scare off anyone thinking of striking a new deal in this environment, take a look at some of the agreed-to deals that have yet to cross the finish line. Like all those LBO deals merger-arb investors are fretting over, or Bank of America-Countrywide.
There is a precedent for deal makers taking their time to wake up to reality. Companies continued to announce big deals for months after the stock market’s tech wreck of 2000. Remember Deutsche Telekom-VoiceStream? That $50 billion deal was unveiled in July 2000, four months after the tech bubble burst.
By 2002, merger activity, at $1.2 trillion according to Thomson Financial, had fallen to a little more than a third of its 2000 peak.
#138 – “you and soda”
I felt the same way regarding finance. I used to have tears of boredom rolling down my face in a finance class (but for some reason I liked accounting – go figure). Got my BS in accounting, began walking the line between IT & Acct/Corp Finance, then jumped completely into IT (mistake). Now that I’m understanding and liking fin/econ much more I’ve decided to sit for the CFA in June…hoping to make a career change in the later part of the year.
Tell you one thing…it’s more frustrating knowing that you’re getting screwed by the FED. Psychologically I liked it better when I was more concerned with getting a ride home from the Sunday Bordy Barn event (for those of you familiar with the Hamptons in the summer) than actively partaking in my future!
RE: think if people consider the fact 70% of NJ makes under 100k total household income
How could that be true? Future Elect President Clinton said Middle Class is a dual income working couple making 200K a year just last week.
BTW – What do people on this board think is the most a family (husband, wife, 3 kids, dog), can earn and still with a straight face say they are middle class.
Is it 150k, 250k, 300k, 400k, 500k+?
Hillary said up to 200k recently, Spitzer in his NYS school tax rebate said up to 250K and Goldman said they are marketing muni bonds to middle class households recently and stated 100k to 500k is middle class.
Re: I liked it better when I was more concerned with getting a ride home from the Sunday Bordy Barn event (for those of you familiar with the Hamptons in the summer) than actively partaking in my future!
Too bad Eds Bay Pub is no longer around, no one ever used to go home after the barn they all hit Eds.
How could that be true? Future Elect President Clinton said Middle Class is a dual income working couple making 200K a year just last week.
Very simple John, when we got tax rebates 70% of NJ got 20% meaning 70% of NJ has a household income of 100k or less.
I dont know what she is smoking, I guess she didnt inhale either LOL
# 151 skep-tic Says:
“January 22nd, 2008 at 10:33 am
The stage is now perfectly set for lower asking prices this spring. The public has accepted that the economy is crap right now. The delusional people who have had their houses on the market for a year or more are going to be blown out of the water by the new comps in a few months.”
If sellers had accepted this two months ago, they would have made out much better. I suspect there are a good number of buyers who are now former buyers. While it may have seemed a good idea to buy with prices going down a bit now, with investment accounts taking a hammering (possibly downpayment funds) and fears about job losses, etc., the prospect of taking on huge new debt loads is going to cause more than a few buyers to hunker down and wait.
John 210
Hillary said up to 200k recently, Spitzer in his NYS school tax rebate said up to 250K and Goldman said they are marketing muni bonds to middle class households recently and stated 100k to 500k is middle class.
they are just changing their definitions of middle class in preparation for the hyperinflation that the fed is doing its best to ignite. Dont you know, soon 500K will be the new 50K/yr
Re: Enron loophole. I wrote Senator Menendez about it and I received an official letter back saying the Loophole was closed.
We talk about energy and its economic effetcs here, so you might find this interesting.
from New Scientist
(http://www.newscientist.com/home.ns)
Reserves of coal were supposed to last for centuries, but rock bottom could come a lot sooner than that. David Strahan reports
The main stream is starting to report that our energy reserves just might be overstated…… good think that we have planned on coal to pick-up the slack in energy markets in the US (one of Bushes pet project)
BC (205)-
Thanks. What a bummer of a chart. :)
Clot,
well if you got into gold in the late 90’s you could jump out now and still make a killing. it all depends on when you got in.
Also consider that gold didnt peak in the 80’s until after volker cleaned up the stagflation mess. So using that as a very rough guide, then stay in gold until someone actual cleans our current mess up and then bail.
Income/class is totally dependent on where you live. Most places, $200,000 is rich. It is middle class in NYC, SF, LA, Boston.
Transcending middle class in these expensive areas takes an income of $350-400,000, in my opinion.
Thoughts on the rate cut:
So, we have had a fair bit of loss in the DJIA over the opening weeks then despite a 3/4 pt cut in the FFR the best the market seems willing to do is stay flat. The White House, Big Ben, and assorted others, may sattempt to spin this as a positive result BUT in a world where a 1/4 pt cut can usually be expected to spark a large gain the DJIA’s over 100 point plunge does not leave me feeling giddy with anticipation of a profit-filled week.
Even if the market closes up 50-100 points today, what is there to support those gains tomorrow? Consumers are tapped out, deliquencies on all manner of debt are rising, where will consumers get the bucks to spend? We are due for a correction and it seems to be comming, regardless of how many fingers we stick in the dike. If the FOMC only cuts rates .25 next week, the market will hammer them as still not doing enough, if they cut 1/2-3/4 will that be seen as just right, panic, the right move but too late? I suspect it will be one of the latter two.
John #211
Was Ed’s in the King Kullen shopping center next door?
vodka (218)-
“…stay in gold until someone actual cleans our current mess up and then bail.”
Please wake me when that happens.
Homebuyer sues agent, says she overpaid on her home and that her agent lied to her.
Any thoughts of this being a precedent and it’s effects on RE Agents. Do you think that most would actually stop lying?
http://seattlepi.nwsource.com/business/348265_realestate22.html?source=rss
skep-tic Says:
January 22nd, 2008 at 12:46 pm
Income/class is totally dependent on where you live. Most places, $200,000 is rich. It is middle class in NYC, SF, LA, Boston.
Transcending middle class in these expensive areas takes an income of $350-400,000, in my opinion.
shut up…..stop being baised by what you see
biased…. obviously
make 223
That would be a heck of a precedent if the home owner wins the law suit
I don’t give a whit about everyone’s little toys and foibles. If you are yanking down $150,000 in this area, you can get by. Maybe people have a serious dislocation of perception in terms of needs and wants.
Pathetic really…
Why you do not yank money out of the market…
https://njrereport.com/files/chicago.ppt
# 223 “Any thoughts of this being a precedent and it’s effects on RE Agents. Do you think that most would actually stop lying?”
Stop it? Never. But, that said, it may give a sufficient number of agents pause and encourage them to moderate their cheerleading in situations when any objective analysis of a deal would not justify their upbeat statements.
# 223, another observation:
As any accountant, lawyer, yadda yadda(insert profession here), can tell you, in the interest of protecting the client’s interests one often has to tell a client what they DO NOT want to hear.
Hello,
Can someone please find out the history of this house:
5 Norz Dr
Hillsborough, NJ 08844
Now asking for 599K.
Thanks in advance.
007
Thanks to BC Bob, and countless others I have been long on gold since mid 2007. I have been heavy on Swiss CD’s and actually hold most of cash positions in Euro’s.
I do not own any stock and have not purchased anything(with the exception of CFC) since early 2005. Which menas that I have not been making any money.
The only revenue increases have come in rent increases.
I’m patiently awaiting the tail end of this recession. And I’m mad as hell everytime the fed lowers rates to try to prolong this recession.
During the great depression dollar was backed by gold hence cash was king. In 2008-2015, Gold will be king as hyperinflation destroys the dollar. We will stop spending, borrowing will be sooo 2005, credit cards will actually be taken away from Consumers, rates will be at double digits, our economy will shift from that of consumer and spend based to that of producer and exporter. We will innovate, produce and save.
It’s gonna be painful and long process but at least one generation has to live beneath it’s means to correct the debt and the inflation that we are in today.
I hope nobody from here had anything to do with the following:
http://www.app.com/apps/pbcs.dll/article?AID=/20080122/NEWS/80122006
WAYNE — Wayne police have found a rapid-fire submachine gun that had been missing for at least two weeks.
But they won’t say exactly where the nine-millimeter weapon turned up on Monday.
It’s still not known who took the MP5 gun, which can shoot 700 to 900 rounds per
minute, or how long it was missing from the department’s arsenal.
But the Passaic County Sheriff’s Department is running tests on the weapon to make sure it wasn’t used in any criminal activity.
Meanwhile, Wayne police and county officials are conducting a criminal investigation to determine how the gun went missing.
Are Swiss Francs backed by gold anymore?
007
5 Norz Dr
Hillsborough, NJ 08844
Purchased
04/27/05
$627,000.00
Thats all I got :)
In the former case, goldbugs will get hammered, just like they did in the early 80’s. In the second case, you’d be better off investing your money in canned goods and spare ammo.
There is no silver bullet to this problem. A natural self correction is taking place.
Maybe the answer is put your money in silver; canned goods & spare bullets. If you don’t need to eat it or shoot it, you can melt the silver back down.
I stimulated the economy today. I bought a ready-to assemble coffee table and end table from Home Decorators Collection. They offered me 15% off, which they never, ever do, so I took it.
I did my part. Has the recovery started yet? /*snerk*
from calculated risk
Wachovia: Homeowners just Walking Away
From the Wachovia conference call:
“Part of one of the challenges is, and we’ve mentioned this before, a lot of this current losses have been coming out of California and it’s — they’ve been from people that have otherwise had the capacity to pay, but have basically just decided not to because they feel like they’ve lost equity, value in their properties, and so in a way, we may have — it’s hard to know right now, but we may have seen somewhat of an acceleration problem loans as people have reached that conclusion and we’re just going to have to see how the patterns unfold here.”
emphasis added
237. You have to hire at least twelve illegals, to assemble the table, to stimulate the economy. Blue collar work is illegal in America and has been outsourced. You should not be putting it together yurself.
Re Very simple John, when we got tax rebates 70% of NJ got 20% meaning 70% of NJ has a household income of 100k or less.
Many of that 70% were downright poor or lower middle class. What is the middle income in NJ or median income?
Eds Bay Pub was in the supermarket mall in Hampton bays next to Johns Pizza. The supermarket is now a movie theater
make (223)-
Please. Funny how many people have a “come to Jesus” moment AFTER their closings…then look around for the best person to shoulder the blame for their own stupidity.
Most Realtors can count on one hand the number of clients in a lifetime that do a FRACTION of what we advise them to do. The first thing I tell agents new to the biz is that we don’t change anybody’s mind in this game…we just help them accomplish what they’ve already set their minds to doing.
So, which is it? Are Realtors incompetent and unskilled at persuasion…or, do we wield inordinate influence over hordes of poor, unfortunate dupes?
007 (231)-
Not in front of my database right now, but I seem to remember 1 Norz Dr having a lis pendens filed recently.
That’l be a comp killer, for sure.
Speaking of Hamptons and RE. Hampton Bays has 186 mls homes listed in the dead of winter. There are a lot of exclusives and FSBOs so that 186 is just MLS. Dead of winter in a weak market that is a lot of homes for just one town in the Hamptons. Bad sign.
For thos of you who still don’t believe in Gold.
We are all aware that Bc Bob sold his home in 2005 at the top and has been renting for the past 2.5 yrs.
let’s say he sold for a cool million and he bought gold with his proceeds@$425 per ounce(2352 ounces). For the past 2.5 yrs he has not paid a dime in taxes and maintance and has enjoyed a much lower monthly pmnt. he took out a lease and went on a couple first class vacations with his family with the money he saved.
He can easily buy a similar house today for $900K. That would cost him around 1,000 ounces of gold. Which leaves him with a $1.2 million profit.
not bad ha?
Maybe Congress will raise the Minimum Wage to $100/hr so that more people can afford homes and mortgages.
The 2-year note rose 18/32 at 102 8/32 with a yield of 2.055%.
That is crazy low.
CNN say’s you should be putting more money into the market, there is no fraud.
make[232],
No thanks to me. You pulled the trigger.
Remember, plan your attack, then attack the hell out of your plan. After this, plan your trade and make sure you trade your plan. Risk management should be priority # 1. If only the IB’s could learn this?
John Median income in NJ is 65k. Most of NJ does not have some fancy 6 figure salary.
So you conisder 70% of the state poor or lower middle class? That make no sence when only 30% of the state has a household income of 100k+. I think you need to revisit that thought
30% does not account for all of NJ.
#248 BC,
Stop being modest. It was you who first opened my eyes.
“John Says:
January 22nd, 2008 at 12:30 pm
BTW – What do people on this board think is the most a family (husband, wife, 3 kids, dog), can earn and still with a straight face say they are middle class.”
Economic class is more a function of wealth than income.
I could earn $20K a year and be RICH, if I had $50M in the bank.
I could earn $300K/year and be middle class because I only just got out of law school with $225K in debt and now I’ve got NYC’s cost of living to contend with.
I could have nothing in the bank and make $40K/year and be firmly middle class if I live in northern Maine.
Income is not a good barometer of economic class.
# 214 “Are Realtors incompetent and unskilled at persuasion…or, do we wield inordinate influence over hordes of poor, unfortunate dupes?”
It depends on whether you are holding an RPG at the time.
Homer Says:
January 22nd, 2008 at 1:47 pm
John Median income in NJ is 65k. Most of NJ does not have some fancy 6 figure salary.
Homer, just ment to say if you think the upper 30% is rich to me the bottom 30% is poor and the middle 40% is middle class. The whole lower 70% can’t be middle class.
So you conisder 70% of the state poor or lower middle class? That make no sence when only 30% of the state has a household income of 100k+. I think you need to revisit that thought
30% does not account for all of NJ.
They should offer Variable Rate Stimulus, where we could sell our vote proxy to the Highest Bidder. Payable in Gold of course.
Shore (252)-
“It depends on whether you are holding an RPG at the time.”
Nah. My style is strictly soft-sell.
Hey Homer, Newsday said some meter readers out in Long Island make 95K a year in base pay. Now that is good pay!! Even I could read a meter. Of course Spitzer is looking into the 95K meter readers, but it is still a good salary.
I think 300K is the upmost of middle class. Under 300K you can’t regularly buy new cars, go on disney vacations, get baby sitting to go out to dinner, do all the out of home children B-day party stuff and join a county club even if you have a little mortgage. You still gotta watch your pennies. Over 300K you start to spend more freely. Plus it seems that 200 plus jobs are out there, but the pipeline of jobs shuts off at 300K, there are very few 300k+ jobs which makes it an excusive club. Heck two married meter readers make 200K out on Long Island.
Re: class and income
I wonder, what does “middle class” even mean anymore? Everyone I know thinks they are middle class. Everyone thinks they are richer than they are. Everyone thinks the other guy is making too much money.
There are a lot of people who aren’t middle class, they are working class at best.
Middle class would be better than working class, perhaps a degree or two, a professional job. If you have to work for a living, you’re middle class.
The only people who are rich in my book are those who could pack it the working boots tomorrow and be just fine.
Actually cancel what I said about middle class having a degree. Not necessarily true.
Speaking of middle class, I get up in the morning, one guy sells me my newspaper, the second gets me my coffee for the train, when I get to NYC another person gets me my coffee and bagel, then some guy hands me lunch and then some guy checks my ticket on the train and then some guy at the drycleaners hands me my shirts and then a lady gives me some milk and eggs at the drive through. While I am at work, my wife drives around and deals with at least the same amount of service people. That is a lot of people I deal with everyday to make my life work. How the heck do those people support themselves in NYC, it is beyond me. Even more strange is alot are perfectly normal and well spoken, whey do they continue to work in such low wage jobs. The whole thing is pretty interesting. I read the book nickled and dimed and even that author could not answer how Walmart and Kmart can get millions of people to not only work for nothing but to actually do it year after year.
$300K on the table, is about $100K under the table. Lot to be said for under the table, cash business.
John Says:
January 22nd, 2008 at 2:00 pm
Under 300K you can’t regularly buy new cars, go on disney vacations, get baby sitting to go out to dinner, do all the out of home children B-day party stuff and join a county club even if you have a little mortgage. You still gotta watch your pennies. Over 300K you start to spend more freely.
JJ: WTF are you talking about?
Middle class people – don’t belong to country clubs; regularly buy new cars in excess of $40K…..I really starting to think some of you people are quite biased….
I think I understand now…..unless you can blindly spend money on a whim, with only a modest need to check your finances once in a while, you are “middle class or worse”……what a crock!
Some of the Richest people in this Country are “Non College-Blue Collar-Cash Business-Owners”, like Pavers & Landscapers. They are Debt & Tax Free. Other High Profile Non College-White Collar-Non Cash Business-Owners, like Bill Gates, have to earn more, within the Legal Tax Structure.
258 Ann
“If you have to work for a living, you’re middle class.”
As a working rule of thumb, I like this definition for an upper bound on middle class because it takes into account pre-existing wealth. Now you need to differentiate the blue collar and working poor, who also need to work for a living.
quoting atrios, with whom I agree on this point:
“I know some will find walking away from homes morally unsettling somehow, but I don’t see what’s wrong with people behaving as businesses would. It’s the fault of lenders for not ensuring that people had skin in the game by requiring reasonable down payment levels.”
Seems obvious…
John Says:
January 22nd, 2008 at 2:00 pm
Under 300K you can’t regularly buy new cars, go on disney vacations, get baby sitting to go out to dinner, do all the out of home children B-day party stuff
===
Middle class join Country clubs? Ha!, that is a good one!
And I wonder where do these “300K+” have the ‘out of home B-Day party stuff… HAWAII?
patient (264)-
No surprise: in places like Cleveland, Buffalo and Detroit, the lenders walk away from properties after their borrowers do.
Coming soon to Paterson, Trenton, et al.
Fred Thompson just dropped out of Presidential Race.
clot – absolutely – I was considering more the whole “moral/ethical” issue – I hear people say “how could you just walk away even though you have the money to pay?!”
I don’t see the issue. That’s the contract the lender entered into. I don’t know why folks seem to think John Public should be required to give Countrywide a handout for “moral” reasons.
“Fred Thompson just dropped out of Presidential Race.”
That happened in November. Today it was publicly announced.
CNBC: “Nearly 75 percent of Wall Street pros think the Fed did the right thing by cutting rates by three-quarters of a point, to 3.5%, this morning.”
In other shocking news, in a poll of farmers, 75% approved of federal aid for farmers.
Tune in tomorrow for our exclusive poll of illegal immigrants. Do they favor amnesty?? We’ll find out tomorrow!
270 = Classic!
for all you 300K middle class people.. here is the oportunity of a lifetime.
For a meager 150K you can join the beautiful Bayonne landfill… oops! Golf Country Club. Bring your Gasmask.. fumes can kill you.
Hey, you may be able to have your Kids B-day party here.. you know. let them play in the mud, run around, etc.
And I thought that only the pauper (you know, those making 100K-) had to roam through landfills just to get by..
Chicagofinance 207,
What do M&A deals involving resource companies based outside North America have to do with NYC real estate in 2008?
A better way to call NYC real estate in 2008 is to analyze what is going on in NYC real estate. It performed fine during 4Q07, even though the financial crisis was deepening. Although analyzing data from last quarter is backward-looking, the data reflects decisions that signal what is going to happen this year.
The NYC office market is probably the most relevant to northern NJ residential real estate because it influences demand for houses and apartments across the metro area. If finance industry employers were really planning massive layoffs of NYC-based staff, then demand for NYC office space would be evaporating and sublease space would be flooding into the market, depressing rents. Instead, financial firms continued to scramble to add space for workers during the 4th quarter. And plenty of these firms were willing to pay more than $100 per square foot for the privilege.
Moveover, despite the credit crunch, Manhattan office buildings continue to trade hands at astronomical prices. Altria recently agreed to sell its empty former HQ building (120 Park) for $500 million, or $800 per square foot.
I don’t recall making a specific call on NYC, although I wrote in September that, “Wall Street firms are optimistic about the outlook for their businesses and comfortable with current staff levels.” It is still too early to predict if demand for NYC real estate will hold steady thru 2008, although I expect it will. But it isn’t too late to point out the accuracy of the responses to that quote:
“I’m hearing 10-20% layoffs”
“30-50% layoffs” at Bear
“old ‘October surprise’ is still the way the Street does it”
“Typically they start in October, go on until right before Thanksgiving, stop until after Christmas, resume again in January through Feb”
“Wait until the end of October, cuts before bonus calculations”
“bonuses will be down even in areas that were doing fine”
These people were so wrong it is laughable.
Confused (269)-
Who is Fred Thompson?
# 265 “And I wonder where do these “300K+” have the ‘out of home B-Day party stuff… HAWAII”
This reminds me of something I saw when I was in college (all but eating dog food to get through, yadda yadda). Anyway, there was this guy I knew through a friend (Herinafter “Rich Guy”). So Rich Guy wants to have a big 21st birthday party and Rich Guy’s parents say sure. What do they do? They charter a big-@ssed commercial jet, a DC-10 or such, to fly him and something on the order of 100 of his closest friends to Vail, where they have condos, cars,yadda yadda, all set up for them.
My friend got to go, I didn’t even get a tee shirt, lol.
pret (273)-
Right now, how comfortable do you think Harry Macklowe is about prospects for the coming year?
263
I don’t know how you really separate out the working poor from the middle class. At a basic level, they probably all have the same things (some form of housing, a car, a job, bigger dreams for their kids). Maybe the middle class can buy themselves out of a few challenges (good healthcare coverage, good schools, functioning cars) things, that when they malfunction, can sink the working poor.
I think John’s point has some validity. “Over 300K you start to spend more freely.”
Above a certain income level, even if it is from hoofing it to a job every day, part of it becomes gravy because the core costs of living (a house, car, clothes, food) don’t go up along with your income.
Hey I drive a ten year old Sable, cringe at $300 bucks for my kids b-day party, did not go on vacation last year and don’t belong to a country club.
I need at least 300k in order to buy a new american car every four years, belong to a pool club and go on a nice vacation once a year, shop somewhere better than kohls and take my wife out to dinner with babysitting more than once a year. I am not talking Trump, just being able to pay all my bills, keep savings and enjoy a few fruits of my labor.
278 I dont know about 100K would allow me to do all of that.
Reasonable expectations of success and productivity :)
guys, here is a serious questions: with this super low mortgage rate and stimulus package, what would be the impact to NYC metro real estate market? Homebuilders have been strongest in S&P industrial groups in last 10 sessions.
Clotpoll,
I know that you know that Macklowe is an exception.
Macklowe, like Kushner, is worried about refinancing short-term debt, not about the value of the real estate his family owns.
New York office landlords are thrilled to be getting $100+ rents in the current environment.
Well I dont need a new car every 4 years :) Thats a big expense there for no reason
# 277
I espouse looking at nine economic levels. It makes the analysis ring true, even if the cut-off points are open to debate. For teh higher levels, net worth seems more important than earnings. For the lower levels, earnings become more important inasmuch as there is little in the way of net worth:
Upper-upper, Bill and Melinda, Warren, Saudi princes etc.
Middle Upper, say net worth of between $25million to $200-200 million.
Lower Upper, $ 10 million to $25 million
Upper Middle $5 million to $10 million
Middle Middle I leave it to others to define in NJ based on the other parameters set forth here
Lower Middle I leave it to others to define in NJ based on the other parameters set forth here
Upper lower (Where a good proportion of folks who define themselves to be middle class really are) In NJ likely a family income of between $ 60,000 and $120,000 a year.
Middle Lower, In NJ likely a family income of between $30,000 and 60,000
Lower Lower, In NJ likely, family income from $30,000 to homeless.
grim:
did this mls: 2445420 close?
thks.
“guys, here is a serious questions: with this super low mortgage rate and stimulus package, what would be the impact to NYC metro real estate market?”
bi,
Lower rates does not cure inslovency.
Stimulus Package? If they give you a couple of lemons, make lemonade?
274 Clotpoll Says:
January 22nd, 2008 at 2:56 pm
Confused (269)-
Who is Fred Thompson?
njpatient Says:
January 22nd, 2008 at 2:38 pm
“Fred Thompson just dropped out of Presidential Race.”
That happened in November. Today it was publicly announced
Ask njpatient, he’s been tracking him more then me.
I think the problem is that I define middle class based on where I grew up (not near NYC). I actually don’t think there is much of a true middle class in the NYC area. The stratification of wealth constantly amazes me around here.
Mark,
No, still UC
From Bloomberg:
Pimco’s Gross Says Fed Rate Cut a `Sad Testimony’
Bill Gross, manager of the world’s biggest bond fund, said the Federal Reserve’s emergency cut in borrowing costs today is a “sad testimony” on the state of the U.S. economy.
The central bank cut the target overnight lending rate to 3.5 percent from 4.25 percent after stock markets tumbled from Hong Kong to London amid increasing signs of a U.S. recession. Policy makers weren’t scheduled to gather until next week.
“It’s a sad testament to think the Fed has to cut interest rates eight days in front of a meeting to salvage the equity markets,” said Gross, the founder and chief investment officer of Pacific Investment Management Co., in a Bloomberg Television interview. “The U.S. economy is in a rather sad state of affairs in that it depends on housing and stock prices to keep going.”
“The U.S. economy is in a rather sad state of affairs in that it depends on housing and stock prices to keep going.”
Everything else of value was outsourced.
To me, middle class means that you can afford to own a 3BR home, send your kids to decent schools, health insurance, occasionaly vacation, new car when you need it (but not a luxury car) and save enough for retirement.
Lower class means you don’t make enough to save, you probably rent permanently, kids go to bad schools, no vacations, very old used cars, no health insurance.
Rich to me is owning more than one home, saving more than 20% of income, fancy vacations, early retirement, private school for kids, only one spouse working, luxury cars.
Now if you put a price tag on this, I think you will find that even “middle class” adds up to a lot in the NYC area.
pret (281)-
One man’s “exception” is another man’s bellwether. Thank you for this most evasive of answers to my previous question:
“I know that you know that Macklowe is an exception.
Macklowe, like Kushner, is worried about refinancing short-term debt, not about the value of the real estate his family owns.”
Whew. It puts my mind at ease knowing that Kushner is selling everything he owns that isn’t nailed down just for the thrill of it and Macklowe isn’t facing big problems because he can neither fill- nor refinance- his vacant, equity-starved buildings.
Your willful ignorance is Panglossian.
BTW, commercial rents are dropping like a rock in the City of London…a place where there are still financiers and traders doing deals instead of picking lint out of their navels. There are about 10,000 people on Wall St right now who’d be thrilled to work on a merger between two Sabrett carts, if they could.
What does that say for NYC?
BC (285)-
bi needs a stimulus package, applied Jack Bauer-style.
From Fortune magazine:
Why the Fed can’t save us.
Bernanke and company are using up their limited ammunition, but there remain genuine problems with the low dollar and U.S. debt, argues Allan Sloan.
http://money.cnn.com/2008/01/22/magazines/fortune/sloan_irrational.fortune/index.htm?postversion=2008012213
Sam Zell 1, Macklowe 0. From the 1-15-08 NY Observer:
“The predicament of Mr. Macklowe, watched closely throughout the industry, has become a high-profile symbol of the cooling real estate market. When the veteran landlord agreed in February to pay the $7 billion for Equity Office’s New York portfolio, the sum was impressive to be sure, but not one considered to be overwhelming at the time, given the soaring market. But with the collapse of the subprime mortgage market in the summer, the lending market dried up, leaving Mr. Macklowe, who used $50 million of his own money on the deal, with billions in short-term debt that no longer could easily be repaid.”
US investors exiting stock funds are urged to wait
http://www.reuters.com/article/marketsNews/idUKN2252500420080122?rpc=44
Waaaaah!
Ron Paul wins a NJ republican Straw Poll
http://www.youtube.com/watch?v=BKoRHvJS-WE
Huckabee is officially broke…check it out
http://www.spectator.org/dsp_article.asp?art_id=12611
Guliani is toast.
Clotpoll,
“commercial rents are dropping like a rock in the City of London”
Rents aren’t rising anymore there, but they aren’t crashing either. Can you defend that statement?
I agree that Zell’s timing and sales process were nicely executed, but it followed years of dreadful performance. And Blackstone found a way to get a lot more for the same assets. I’d say Blackstone beat Zell by the score of 3 to 2.
Macklowe’s problem is 99% leverage and near-term debt maturities. That real estate will be worth a lot more during the next peak in the cycle, although somebody else will probably own it.
# 292 Clot,
Isn’t Pangloss Realtors known for their upbeat approach to selling? I believe that their motto is, “it is the best of all possible times to buy real estate.”
#298 awaiting moderation
People are in debt up to their eyeballs judging from walking around the office today, plenty of people were checking rates to refinance their mortgage. Talking about big savings, what the heck?
First why do these people have big mortgages or mortgages at all? They all make well over six figures. I guess they cashed out the equity.
$120,000/yr upper lower? Sorry, but that sounds ridiculi.
All this talk about class, and in the United States no less!
Makes me yearn for the UK, where you can be a multi millionaire with private islands, jets and multiple homes but if your great great grandfather was a coal miner, you are working class.
And you can have no more than two beans to rub together, but if daddy is in Who’s Who, then you are a certified toff.
291 skep-tic
I think you nailed it. And yes, middle class living in this area really requires a heck of a lot of money these days.
Having debt and being able to pay for it are two completely different issues.
Clotpoll Says:
January 22nd, 2008 at 3:39 pm
BTW There are about 10,000 people on Wall St right now who’d be thrilled to work on a merger between two Sabrett carts, if they could.
clot: ok – you got me to smile with that one….
Lawrence Yun approves of the Fed action today.. I’m relieved..
The sad part is the realization that I pay this man’s salary.
From the NAR:
NAR Commends Federal Reserve Board on Timely Interest Rate Cut
WASHINGTON, January 22, 2008 – The following is a statement by Lawrence Yun, chief economist of the National Association of Realtors®, on today’s action by the Federal Reserve Board:
“Today’s 75-basis-point cut in the Fed funds rate to 3.50 percent is a very good step in the right direction to boost the economy and send a clear message to both the market and to consumers. This strong rate cut will help lower mortgage interest rates and lessen the burden of adjustable-rate loans that are resetting in the current environment. It also could help stimulate business investment in the wake of market uncertainties. We commend the Federal Reserve Board on its bold action, but at the same time we urge it to keep a close watch to see if additional action is needed.”
The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing more than 1.3 million members involved in all aspects of the residential and commercial real estate industries.
skep-tic Says:
January 22nd, 2008 at 3:26 pm
To me, middle class means that you can afford to own a 3BR home, send your kids to decent schools, health insurance, occasionaly vacation, new car when you need it (but not a luxury car) and save enough for retirement.
You just described 300K+ a year for North Bergan or North Shore of Long Island.
pret: I appreciate that there are many things posted on this board that are not well considered. However, in your position, you certainly have the acumen, resources, and access to provide more insight. I am consistently surprised by your comments, but I will not dismiss them, because there is validity in your facts. You certainly have grounds for your opinions, but I strongly disagree with you.
chicagofinance Says:
January 22nd, 2008 at 12:59 pm
Why you do not yank money out of the market…
https://njrereport.com/files/chicago.ppt
nobody liked this one….I thought it was pretty informative…..I stole it from a mutual fund wholesaler….
Chicagofinance,
Thank you for the kind words. So I’m curious to know, which positions you disagree with and why?
310 John
No way, 300K. I’d say close to 200K though.
From Reuters:
Freddie Mac, Fannie Mae may write down $16 bln
The largest U.S. housing finance companies, Freddie Mac and Fannie Mae, may report $16 billion in write-downs for the fourth quarter due to the falling value of their subprime mortgage investments, according to Credit Suisse analysts.
Freddie Mac, with $105 billion of subprime securities, could write down between $8 billion and $11 billion when it reports earnings if management deems losses in market value are “other than temporary,” they said. Fannie Mae’s losses could be $2.25 billion to $4 billion, the analysts, led by Moshe Orenbuch, wrote in a note on Tuesday.
Chifi,
I had sell stops in place, I didn’t yank money out of the market. I have a diversified portfolio. Some bonds (Tips), Gld, DBA, OIL, and the only stock holdings I have left are MSFT and the SDS. I now have about 18K in cash and its going to stay there until after earnings. I’ll leave the dollar cost averaging to my 401k.
Heath Ledger dead, says Mrs. patient.
Heath Ledger finito….
Jeez Grim with news like that we may need another rate cut tomorrow!
jinx
Apple getting smacked….
The largest U.S. housing finance companies, Freddie Mac and Fannie Mae, may report $16 billion in write-downs for the fourth quarter due to the falling value of their subprime mortgage investments, according to Credit Suisse analysts.
Can’t be BI said that there won’t be any more writeoffs. tell them bi.
on a day like this I wonder if Donald’s house fell off thye cliff.
The way we are getting rate cuts I won’t need to refinance my puny mortgage, I can just get a home equity loan at 4%!!!
“Heath Ledger dead”
Who is this?
322#, why you guys are so high on writeoffs? the first one is a victim and the rest are just numbers. If that was so important, FRE and FNM would tank after hours just as AAPL. But they did not. check out all major homebuilders they are on fire.
“check out all major homebuilders they are on fire.”
bi,
Did you mean to say burnt to a crisp, Elvis Patterson like?
324
“We will always have Brokeback”
Teaneck
SLD 572 LUCY AVE $490,000 6/22/2005
SLD 572 LUCY AVE $360,000 1/21/2008
#294 Clot:What does that say for NYC?
It says there will significant more layoffs on Wall St (They have already started).
Pret thinks thats balderdash;however its true.
322 make
and yet Paulson was on my teevee today saying we should raise the conforming loan limit
Brilliant!!
Bi!
You’re coming to the Counter Party, right?!?
“bi Says:
January 22nd, 2008 at 5:09 pm
322#, why you guys are so high on writeoffs?”
Possibly because you had some crackpot theory about how the economy was going to zoom to the stratosphere because all of the bad information had already come out?
It’s ok to admit being wrong, bi.
#282 pret: Macklowe, like Kushner, is worried about refinancing short-term debt, not about the value of the real estate his family owns.
Well one could argue if there was no worry abou the value of the real estate, then why the concern about being able to refinance the short term debt?
I’m new to equity investing, and I keep hearing about the benefits of dollar-cost averaging. I understand the concept, but I have a stupid question.
Don’t the multiple transaction fees in essence cancel out some of the effect of the averaging? Or is this technique supposed to be used when purchasing thousands of $$ of shares at a clip?
#281 bi: It means NYC real estate and all the towns that are just minutes from NYC, are going to explode in an unpredecented rise in prices. Up, up. up, and away.
Well typical discount broker you are paying $10 a trade so you factor that in for your transaction costs.
This is a pretty good read, and I highly recommend that Leeb book he mentions:
http://www.newstarget.com/022528.html
#325 bi:But they did not. check out all major homebuilders they are on fire.
So we should be buying home builder stocks? Call us when you finish putting out the fires.
“Well one could argue if there was no worry abou the value of the real estate, then why the concern about being able to refinance the short term debt?”
Because when Macklowe negotiated the financing for the EOP properties, banks would give you loans equating to 100% of the value of the properties.
Macklowe bet that New York office building values would continue to rise and that, when his short-term loans matured, he could get 100% financing based on the new, higher values. Macklowe would’ve pocketed the rise in value under this scenario.
Instead, values held roughly steady and banks reduced loan-to-value ratios. But Macklowe is on the hook for the short-term loans. He can’t refinance them, so he needs to find another way to pay the banks back.
In other words, Macklowe’s problems stem from a deterioration in lending terms, not a drop in real estate values.
“In other words, Macklowe’s problems stem from a deterioration in lending terms, not a drop in real estate values.”
Sounds like a bad bet to me.
So anyhow, my friend is going to sell her house in HO HO Kus soon, plans a FSBO for 100K above 2005 purchase price. Will sell for 75k more but no less, claims she got an ok price at the time and she painted everything and fixed it all.
I am going to help her for a few hours, it is on Hollywood ave and is in mint cond. 3 bed, 3 bath, 2 car. few blocks school and train.
Lets see how quick I can move it, she only wants to list 30 days and then pull from market if she does not get her price.
Should be fun. She claims they are still moving in her area at above 2005 prices. Who Knew!
Didn’t some other young actor just die? The kid from “The Client”?
Have to say, Heath Ledger didn’t appear to be in the same mode – successful and not particularly junkie-ish.
Bit sad.
#334 – sybarite
re: dollar cost averaging
many times, when you hear about dollar cost averaging, they are talking about dollar cost averaging into a mutual fund – so, i believe, you would avoid the multiple transaction fees you speak of in your post. for example, sometimes it is advised to buy a specific dollar amount weekly ($50 for example), in a fund.
Sybarite Says:
January 22nd, 2008 at 5:25 pm
I’m new to equity investing, and I keep hearing about the benefits of dollar-cost averaging. I understand the concept, but I have a stupid question. Don’t the multiple transaction fees in essence cancel out some of the effect of the averaging? Or is this technique supposed to be used when purchasing thousands of $$ of shares at a clip?
syb: first you need to ask the cutting edge of all financial knowledge and the Oracle of the NJ RE Report, so my comments are secondary here:
You should not DCA with an ETF, I think that issue is your concern. Use a mutual fund.
# pretorius Says:
January 22nd, 2008 at 9:46 am
3b 55,
“What happens to housing now?”
The rich get richer. Homeowners with a lot of equity in their homes refinance their mortgages at rates in the low 5s and increase their monthly income by a couple hundred bucks with a flick of the wrist.
This is assuming, of course, that the homeowners have the equity you speak of. And how many people that bought in 2004 do you think have enough equity to refinance? Obvious any answer anyone gives is purely subjective, since this stat doesn’t exist.
Re: DCA
Thanks for your insight.
324. BC Bob Says:
January 22nd, 2008 at 5:07 pm
“Heath Ledger dead”
Who is this?
Didn’t he beat out ex Governor McGreevy for the role in Brokeback Mountain?
334#, it depends on your investment horrizon. if you are for long term, it is not big deal by adding $10 transaction cost each quarter.
To me, ETFs and CTFs are the best for CDA. But be careful, some CTFs have very high concentration on signle stocks. For example, DNA in BBH.
Bush Confident He and Congress Can Agree on Stimulus Plan
http://biz.yahoo.com/ap/080122/economy_stimulus.html
Does this remind you of a bad forclosure where the previous occupier of the house trashes the propery on the way out the door.
http://www.bloomberg.com/apps/news?pid=20601070&sid=aFRluJ5sabGw&refer=home
341 John re house in HoHoKus
Is she joking? If she bought in 2005, I don’t care what town it is, and the luckiest she will ever get is what she paid. If she didn’t did major work, other than painting, who knows. If not, plan on 10% below what she paid right now IMO.
Why does she want to move anyway? I guess she really doesn’t have to move with a plan like that; hope she likes it there! : )
#236 homer,
Many thanks.
007
351….Yes Anne, but this house is ‘mint’. Come on.
353
I have a new word for RE listings…
Post-Mint
I am doing a write in vote for Lou Dobbs for President. Can’t decide whether Rocky/Rambo or the Terminator would make the best VP though.
pret (300)-
Here’s an excerpt from a 1-7-08 Bloomberg article on the UK commercial RE market which I believe may have already been posted here. Please forgive me…the exact words “rents are crashing in the City” don’t appear here; however, to believe rents remain even flat in these surrounding circumstances is ostrich-like, to put it kindly:
“Britain’s 700 billion-pound commercial property market will perform worse in 2008 than the rest of Europe, the U.S. and Asia, Hobbs said.
Financial District
Real estate investors still underestimate the economic slowdown caused by higher borrowing costs and banks’ reluctance to lend, according to Martin Allen, an analyst at Morgan Stanley in London. He expects “further significant falls” for shares of U.K. property companies in 2008.
The credit crunch may cause financial-services companies in London to cut 6,500 jobs and reduce bonuses by 16 percent, according to data compiled by the London-based Centre for Economics and Business Research Ltd.
British Land has yet to find tenants for its Ropemaker and Leadenhall Building developments in London’s main financial district, which are scheduled to be completed by 2011. The company’s shares tumbled 45 percent in 2007, exceeding the average 39 percent decline for U.K. real estate stocks.
Derivatives pegged to IPD’s total-return indexes indicate owning a commercial building may not become profitable until 2011, prices quoted by Tradition Financial Services showed.”
Entire article:
http://www.bloomberg.com/apps/news?pid=20601109&sid=a3EQxfG_oF6k&refer=home
Shore (301)-
…in the best of all possible worlds!
#341 John: Your friend is dreaming.
fuunyyyyyyyyyyyyyyyyy have fun
Mighty Mouse Bernanke Fails To Save The Day
Investors looking for Mighty Mouse in the wake of a Global Bloodbath were not disappointed. Indeed, Mighty Mouse Bernanke Flew By at precisely 7:00 AM today. Click here for sound effect. It was a valiant effort. Several times the S&P rallied back close to even only to fall back. The Nasdaq never came close.
The S&P 500 futures closed day down 15.75 points or 1.2% and the Nasdaq futures closed the day down 48.5 points or 2.6%
That is a “success” of sorts given the S&P day session open down 56+- points and the Nasdaq down 99+- points. Bears covered financial positions of all kinds. Ambac (ABK) closed up 28% and MBIA (MBI) closed up 46%
However, Bulls can take no pleasure in the relatively dismal performance of tech and even less pleasure in the after hours session that opened up 25 points in the red on the Nasdaq and 8 in the red on the S&P. Anything can happen by the morning, however. Asia might be interesting tonight.
Ambac Loses $31.85 Per Share
Ambac Posted a $3.26 Billion Quarterly Loss, $31.85 per share with an operating loss of $6.21 per share vs. an expected $3.50 share loss. However, Ambac rallied on news that it was “evaluating strategic alternatives with a number of potential partners.”
Anyone feeding capital to Ambac at this point probably needs to have their head examined.
California Foreclosure Activity Soars
Meanwhile, California Foreclosure Activity Is Still Rising.
The number of mortgage default notices filed against California homeowners jumped last quarter to its highest level in more than fifteen years, a real estate information service reported.
Lending institutions sent homeowners 81,550 default notices during the October-to-December period. That was up by 12.4 percent from 72,571 the previous quarter, and up 114.6 percent from 37,994 for fourth-quarter 2006, according to DataQuick Information Systems.
Last quarter’s number of defaults was the highest in DataQuick’s statistics, which go back to 1992.
On primary mortgages statewide, homeowners were a median five months behind on their payments when the lender started the default process. The borrowers owed a median $11,121 on a median $340,000 mortgage.
On lines of credit, homeowners were a median seven months behind on their payments. Borrowers owed a median $3,379 on a median $56,000 credit line. However the amount of the credit line that was actually in use cannot be determined from public records.
Housing Crashes Through The Floor In Chicago
Clotpoll wrote:
“commercial rents are dropping like a rock in the City of London”
Clotpoll,
Are you retracted this statement, or transforming it into a prediction?
grim (309)-
That’s ok. Hosting this blog expunges your sin (mine too…I hope).
How long has it been since your last confession, lad?
Three Hail Marys and come back next week.
Go forward, and sin no more.
#339 pret In other words, Macklowe’s problems stem from a deterioration in lending terms, not a drop in real estate values.
Or his problems stem from a deterioration in lending terms, and a possible drop or flattening in real estate values.
If his values were based on 100% financing, than the value was bogus in the first palce, same as we are now seeing in the resiential housing market.
pret (339)-
Are you really this dense?
“In other words, Macklowe’s problems stem from a deterioration in lending terms, not a drop in real estate values.”
Macklowe’s problems stem from the fact that he made the same bet as the landscaper in Vegas who took out a 2/28 wager that housing prices would continue to zoom skyward ad infinitum.
The Vegas landscaper’s bet can be understood. Tens of thousands of poor schnooks made it. However, when someone like Macklowe leaves himself so pants-down, you have to shake your head and wonder why.
pret (360)-
“Are you retracted [sic] this statement, or transforming it into a prediction?”
I perviously apologized for not being able to find the exact words “rents are dropping like a rock”; however, let’s look at the knowns in this situation:
-rising vacancies in the City
-skyscrapers coming on line, with no tenants
-credit crunch hits Europe
-derivatives contracts indicate owners of British RE may suffer their biggest annual losses in more than a quarter century
Parallel those to this set of circumstances:
-Wil E Coyote chases Roadrunner
-Roadrunner evades Coyote
-Wil E Coyote runs off cliff
-Wil E Coyote stands in midair, legs spinning
Pret, what will happen next? Would that be a statement, or a prediction?
Technically, I guess it would be a prediction, as in 1/4 second, Wil E would begin a plunge to the canyon floor, and in 1 second, there would be a tiny puff of smoke.
Given your tight differentiation between “statement” and “prediction”, I apologize. Obviously, I was making a prediction.
Lou Dobbs just recommended a special place in “Hell”, for the Government Officials, Banks and Wall Streeters that got us to this Financial Crisis. Wonder if that works on people with “No Soul”? I doubt if any of them cast a reflection in a mirror.
#357 “…in the best of all possible worlds!”
Clot,
It is always that way at the corner of Voltaire and Candide.
#232 “007” 5 Norz Drive.
I was curious why it was down to $599 as well and I did the drive by about 2 weeks ago. If you want high tension towers in your backyard then the house is for you. The house backs up to a farm where the high tension towers are. Just fyi.
long-suffering spouse (367)-
Here’s the rub: the power lines are nothing, compared to the stench that comes from that farm in the Summer.
dung + heat + humidity = phew!
Yes boys and girls believe it or nor Kudlow tonight was still talking Goldilocks!!! Amazing!!
just for the record, verypatientwife is not Mrs. patient (though she did a very nice public service).
5 Norz Dr:
Sales:
06/10/2005: $627,000
12/15/1994: $323,000
What a day to buy it was.
http://www.bloomberg.com/apps/news?pid=20601087&sid=ayCqvAmGNNlI&refer=home
and yes #367 was right. go to maps.google.com and pull up the address. look right behind the house and you will see high tension lines right behind the swimming pool area..
John (341),
You had me curious, Ho-Ho-Kus is a great little burg. Until I read Hollywood Ave.
Does your friend realize they basically live on an off-ramp of Rt 17?
I’m with 3B, they’re dreaming.
In case “007” is interested in that area – the neighbor of 5 Norz # 1 Norz is in foreclosure (posted on somerset county sheriff’s list)
“One of the things you must understand about 1929 … in attributing intelligence to the simple fact that people are associated with large sums of money or large financial operations. We don’t ask whether they’re intelligent. We say, they’re associated with all this money, so they must be intelligent. We attribute intelligence to association with financial operations. And only afterwards do we discover that error and that the people involved can be extremely successful in gulling themselves. That they can be in effect, and I use the word advisedly, marvellously stupid.”
“Carried Away By the Illusion of Ever-Increasing Wealth” — John Kenneth Galbraith
Does your friend realize they basically live on an off-ramp of Rt 17?
Rich,
However, that off ramp may be newly painted and possibly include granite stop signs?
John,
Is the Hollywood Ave house a ranch?
Rich
“In the accepted history of these times, the Federal Reserve authorities are held to be not so much unaware or unwilling as impotent.”
“The Great Crash” – John Kenneth Galbraith
Okay… WTF?!
Glen Rock
SLD 542 ACKERMAN AVE $360,000 3/31/2004
SLD 542 ACKERMAN AVE $810,000 6/28/2005
(New construction on existing foundation)
SLD 542 ACKERMAN AVE $790,000 6/22/2006
SLD 542 ACKERMAN AVE $782,000 8/22/2007
ACT 542 ACKERMAN AVE $819,000 1/22/2008
(NJMLS 2802998)
Anyone think they’ll get anything near asking?
Anyone think they’ll get even get anything near ’07 let alone ’06 sold price?
(375) verypatientwife
(371) Unknown
Thank you all for the information. I am checking out for my wife’s friend. She came by yesterday talked about this house, I tried to find more info for her. I did not known there is a tower.
Also, how could she go for the foreclosure house (#1 Norz)? Advice needed.
I love this web site, now I love it more. :-)
007
However, that off ramp may be newly painted and possibly include granite stop signs?
Bob,
And tumble tile, double yellow lines.
lisoosh Says:
January 22nd, 2008 at 4:27 pm
“All this talk about class, and in the United States no less!”
Yep. Marx would be proud.
Man oh man…..society is on the brink.
Feels like anything could happen…and it would be all over the internet. Tense.
Look what’s on the Dollar Menu….I’m Lovin’ It….
WSJ
Starbucks Testing $1 Cup of Coffee
By JANET ADAMY
January 22, 2008 9:00 p.m.
Starbucks Corp., the company that popularized the $4 cup of coffee, is testing a $1 cup of brew and free refills for drip coffee.
The Seattle coffee giant is experimenting with selling a so-called “short” size drip coffee for $1 in the Seattle area, Starbucks spokeswoman Valerie O’Neil confirmed. The short size is an 8 oz. cup that is not officially on the Starbucks menu but has long been ordered by in-the-know patrons who want small drinks. Typically, a short, brewed coffee would sell for around $1.50, though that can vary by several cents depending on the store. Starbucks is also testing offering free refills for traditional brewed coffee, also in the Seattle area.
Ms. O’Neil would not elaborate on the specifics of the tests or say how many locations in the Seattle area are doing it. She said the tests aren’t indicative of any new business strategy.
Starbucks has said that pressures on consumer spending have slowed customer traffic at its stores. The company has raised its prices to offset higher ingredient costs, a move that analysts say has eaten into its sales.
The $1 test undercuts even low-cost coffee purveyors, including McDonald’s Corp. and Dunkin’ Donuts Inc., whose coffees generally start in the low $1 range. Although most sit-down restaurants top off customers’ brewed coffee free of charge, specialty cafes have largely stayed away from it.
007
http://www.somcosheriff.org/sales.htm Look at doc #232 I don’t know much about foreclosures but I did follow one on this list that took almost a year before it was auctioned off in Country Classics on Vliet Road in Hillsborough for $514K. Alot of work goes into foreclosure, I called the sheriff’s department and asked questions. Sorry, its about all the advice I can give.
007
my apologies… it’s doc 8379. I’m too busy multitasking
Pre – Clearly, you just go into NYC to work and don’t live or spend considerable time there. There have to be at least a dozen brand-new high-rise buildings due to finish this year in NY, and that doesn’t take into account how many apartments are being turned into condos.
My friends in Midtown East just got booted from theirs because the choice was rent for $3200 (1 bedroom, split into 2) or buy for over 700k.
It’s coming to NY alright – be patient. You seem like a smart guy, so please quit thinking NYC is bulletproof.
007 (381)-
Don’t bother. House is going back to the bank, whole neighborhood smells like cow poop in hot weather.
A concern on Lou Dobbs tonight was Stimulus Money spent at Malls, would stimulate China, not the US. Another was the slow pace of building the boarder security fence. One guest suggested spending the stimulus on US infrastructure, like bridges, roads and the fence, so 100% of stimulus benefited the US. Makes sense.
pret 360, clot 364
I can’t give detail, but I can tell you that no one with money to lend trusts NYC commercial leases anymore. There is a recent multi-billion dollar acquisition of commercial rental spaces in Manhattan where the banks representing the purchaser could not syndicate the debt and wound up holding the bag on the entire credit facility.
That should tell you more than simply that NYC commercial leasing is on the brink.
further, regarding Britain, the populace is generally in greater panic regarding RE than we are here.
Earlier this year, The Nation wrote a piece called “Outsourcing Is Hell,” while The Economist commented, “Foreign competition now affects services as well as manufacturing. Good.”
Neither argues reality: America can’t compete in manufacturing with lower-wage nations. In theory, lower costs and prices of goods and services benefit consumers and allow America to shift resources to making what it makes best (entertainment, financial services—now at risk).
Interesting that what we make best is now at risk.
False Statements Precede War
http://news.yahoo.com/s/ap/20080123/ap_on_go_pr_wh/misinformation_study;_ylt=AuvzKv_aIk3NQtPEAlJ1FuWs0NUE
Say it isn’t so George!
NBC news guy was mugged in Manhattan
I’ll bet it was Doyle, in the pub, with a knife!
393 confused
seems like old hat – where the rubber hits the road is whether they were just false statements (i.e., mere incompetence) or lies.
patient (390)-
“…no one with money to lend trusts NYC commercial leases anymore”
They all learned during the dotbomb era that tenants can all-too-easily pull a midnight eviction. Back up the truck, load it up and call it a day. It’s simply too easy to stiff the landlord and disappear. Of course, landlords always have the obligation to first attempt to mitigate their own losses when this happens, so they simply try to re-rent the space and forget about chasing the deadbeat tenant.
Most investors have already also learned that landlords, REITs and property managers know every trick in the book to fudge vacancy factors, too.
Dubya has permanently blurred the line between his incompetence and his lies. They are almost one and the same.
396
yes as to all that
The banks holding the bag wish they hadn’t missed that day of school.
#386 verypateintwife
Thank you so much. It asks for $528K. But my friend told me that she saw it was on MLS for something like $700K, I think that was before the foreclosure.
BTW, do you know the link for Bridgewater sheriff office? I am still looking for myself at BW area.
Many thanks,
007
007 (399)-
The biggest favor I can do for you is not give you that site.
Sheriff sales are no place for a beginner, intent upon buying a property. Long story short, that house is on a one-way track back to the bank. The current 700K asking is untenable and is, in itself, an indication the occupant’s hopelessly underwater state.
If you’re really interested in that house, wait until the bank takes it back and has to put it out REO. Chances are high it’ll then be priced right and you can make a nice deal without getting treated like a minnow in a shark tank.
#391 nj patient:the populace is generally in greater panic regarding RE than we are here.
We are not far behind.
#380 RIch And its on a very busy street.
Shore Guy 214
Totally agree and see it on myself.
402 Clotpoll
Thanks for the advice.
007