First Quarter GDP, FOMC on tap

From Bloomberg:

Economy in U.S. Probably Expanded at Slowest Pace in Five Years

The U.S. economy probably grew in the first quarter at the slowest pace in five years as consumer and business spending faltered and the housing slump deepened, economists said before a government report today.

A 0.5 percent annual pace of growth from January through March, the smallest gain since the last three months of 2002, is the median estimate of 80 economists surveyed by Bloomberg News.

“I’d probably call it a recession,” said Joshua Shapiro, chief U.S. economist at Maria Fiorini Ramirez Inc. in New York. “It’s a pretty bad environment that is unlikely to get better any time soon. The consumer is on very shaky footing.”

Spending by households, the biggest part of the economy, probably grew last quarter at the slowest pace in 13 years as job losses mounted, food and fuel prices surged and property values tumbled. Federal Reserve policy makers are forecast to cut the benchmark interest rate today to limit the downturn.

The Commerce Department’s report on gross domestic product, the volume of all goods and services produced, is due at 8:30 a.m. in Washington. The economy grew at a 0.6 percent pace in the last three months of 2007.

From the AP:

Fed expected to cut key interest rates one more time

The Federal Reserve, which began the year aggressively fighting a severe credit crunch and economic weakness, may push the pause button after delivering perhaps one more quarter-point cut in interest rates.

Fed Chairman Ben Bernanke and his colleagues were to wrap up a two-day meeting Wednesday and financial markets widely expected that the discussions will end with an announcement that the Fed will cut a key interest rate by a quarter-point.

That would be the seventh reduction in the federal funds rate since the central bank began battling against the credit squeeze and the growing possibility of a recession last September.

The Fed delivered two three-quarter-point moves and one half-point cut over an eight-week period from mid-January to mid-March that represented the central bank’s most aggressive rate cuts in a quarter-century.

However, the central bank is expected to respond with a less aggressive quarter-point move at this meeting, in part because the financial turmoil seems to have eased and because there are growing concerns about inflation.

While there is some thought that the Fed might decide to forgo a rate cut, most analysts believe that the greater likelihood is a quarter-point move.

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244 Responses to First Quarter GDP, FOMC on tap

  1. grim says:

    From the WSJ:

    Delinquency Rate
    Growing More Slowly
    April 30, 2008

    The subprime-mortgage market still is getting worse each month, but there are some indications that the massive problem of borrowers falling behind on their loans may be moderating.

    Data provided recently to holders of securities backed by subprime mortgages showed that the number of borrowers who were delinquent on their home loans rose at a slower pace in April than in March. It was the third month in a row in which mortgages went bad at a slower rate. The data come from so-called “remittance reports” that are distributed monthly by trustees of mortgage-backed securities tracked by the widely followed ABX indexes.

    Among pools of subprime mortgages made in the second half of 2005, the proportion of loans that were more than 60 days delinquent rose by 1.23 percentage points in April to 35.9%. That compared with a 1.61-percentage-point increase in March, a 2.36-point increase in February and a 2.64-point rise in January, according to a report from Wachovia Capital Markets. The report said similar trends were observed in April for loans made in 2006 and the first half of 2007. On average, between 25% and 40% of the subprime loans in these groups are more than 60 days delinquent.

    While it is hard to predict when the subprime market will hit bottom, some analysts think the recent data indicate that some sort of stabilization is under way.

    But many market participants remain skeptical or bearish about the outlook for subprime. Richard Parkus, an analyst at Deutsche Bank Securities, says the recent remittance data showed “no clear evidence of any recovery,” and his firm continues to expect extraordinarily high levels of losses among subprime loans.

    Skeptics also say that with home prices falling and unemployment rising, delinquencies will keep climbing. There is also a possibility that the recent delinquency data might have been influenced by seasonal factors, such as individuals using recent tax refunds to become current on their mortgage payments.

  2. SG says:

    NY Times article,

    The Road to a Jumbo Mortgage Was Supposed to Get Easier

    In early February, Congress gave beleaguered mortgage borrowers a rare cause for celebration. As part of the economic stimulus package, it passed rules intended to make it easier and less expensive for people to take out hefty loans in the nation’s costliest housing markets.

    Instead, the effort to make it easier to get jumbo mortgages — loans over $417,000 — has yielded frustration and disillusionment.

    The program “is so much of a failure that it’s really unbelievable,” said Daniel M. Shlufman, president of the FCMC Mortgage Corporation in Clifton, N.J. Mr. Shlufman likened Congress’s effort to “coming up with a vaccine to a terrible disease, and then not giving it to people, or making it too expensive.”

    Members of the financial services community, including executives of major banks, investors and mortgage lenders, have said there are good reasons that rates are not dropping and more new-style jumbo loans are not being written. They say that jumbo rates — even “conforming” ones — are unlikely to fall completely in line with conforming rates.

    An influential trade group of the nation’s largest financial institutions, the Securities Industry and Financial Markets Association, recently made a key decision that some critics say has kept those rates from dropping. The association decided that loans above $417,000 — even those jumbo loans now considered by law as conforming — would not be eligible to participate in the “to be announced” market.

    “I’ve been a little disappointed by the securitization people,” Representative Frank said. “What I’m told when I complain is that they have to iron out some wrinkles. It’s taken them longer to take advantage of this than I expected.”

  3. SG says:

    Philadelphia area’s foreclosure rate drops 30%

    The Philadelphia region’s first-quarter foreclosure rate fell almost 30 percent from the same period a year earlier, bucking a national trend that saw filings rise to one in every 194 U.S. households.

    The rate puts Philadelphia 82d on a list of 100 metropolitan areas compiled by RealtyTrac Inc., the Irvine, Calif., firm that tracks foreclosures nationwide.

    Included in the top 10 metro areas for foreclosure filings were six cities in California, as well as Las Vegas, Detroit, Phoenix and Fort Lauderdale, Fla.

    Stockton, Calif., in the central part of the state, led the list with 7,560 filings, or one household in 30, an increase of almost 292 percent from January-to-March 2007.

    The more-populous eight-county Philadelphia region had 3,064 filings, or one household in 527, a decline of 29.64 percent, RealtyTrac’s data show.

    Nationally, there were 649,917 filings in the first quarter, an increase of 112 percent over January-to-March 2007, RealtyTrac reported.

  4. SG says:

    N.J. foreclosure filings rank 16th-highest in nation

    Star-Ledger Staff

    The onslaught of homes facing foreclosures has yet to ebb, a research report showed yesterday, with bank repossessions skyrocketing in the first quarter of 2008.

    “Foreclosure activity in the first quarter increased on a year-over-year basis in 46 out of the 50 states and in 90 of the nation’s 100 largest metro areas, demonstrating that most regions of the country are seeing more foreclosures,” said James Saccacio, chief executive of RealtyTrac, a California firm that tracks foreclosures.

    Nationally, the number of U.S. homes receiving at least one foreclosure filing jumped 112 percent during the first quarter, to 649,917, compared with 306,722 properties in the first quarter of 2007. Filings include default notices, auction sale notices and bank repossessions. The overall foreclosure rate is 23 percent higher than the previous quarter.

    That means one in every 194 households received a foreclosure filing during the first quarter, as declining home prices and stricter lending requirements continued to worsen the foreclosure environment.

    New Jersey had the nation’s 16th-highest state foreclosure rate during the first quarter, with one in every 265 households receiving a foreclosure filing, according to RealtyTrac. Foreclosure filings were reported on 13,104 New Jersey properties during the quarter, up 66 percent from the first quarter of 2007 and nearly 34 percent from the previous quarter.

  5. SG says:

    U.S. Foreclosure Filings Double in First Quarter, Led by Nevada

    The median U.S. home price may drop by a record 5.8 percent this year, Fannie Mae, the world’s largest mortgage buyer, said April 7. Congress, the Bush administration and regulators have urged lenders to renegotiate terms for borrowers so they can stay in their homes, easing the glut of empty houses. Such efforts may mask the slump’s extent by delaying foreclosures, RealtyTrac Chief Executive Officer James Saccacio said in the statement.

    “This country needs a cleansing,” billionaire real estate investor Sam Zell, chairman of Equity Group Investments LLC, said yesterday at the Milken Institute Global Conference in Los Angeles. “We need to clean out all those people who never should have bought in the first place, and not give them sympathy.”

    About $460 billion of adjustable-rate loans are scheduled to reset this year, according to New York-based analysts at Citigroup Inc.

    A surge in defaults among subprime borrowers spurred the collapse of the U.S. home loan market last year and caused more than $300 billion in writedowns and losses at banks and securities firms around the globe. More than 100 mortgage companies have stopped lending, closed, or sold themselves.

    U.S. sales of existing homes probably will tumble to an 11- year low of 4.68 million this year, Fannie Mae, the world’s largest mortgage buyer, said in an April 7 forecast. Sales should climb to 4.91 million next year, the Washington-based company said.

  6. SG says:

    Another Star Ledger article,

    Mortgage payments in trouble

  7. SG says:

    Defaults Rising Rapidly
    For ‘Pick-a-Pay’ Option Mortgages

    April 30, 2008

    As the growth in subprime mortgage delinquencies appears to be slowing, lenders are seeing a rapid rise in defaults on a type of mortgage that gives consumers with good credit several different monthly-payment options.

    These mortgages, which are sometimes known as “pick-a-pay” or payment-option mortgages but are generically called option adjustable-rate mortgages, are turning out, in some cases, to be even more caustic than subprime loans, in part because the loan balance and the monthly payments on some loans is growing even as home prices are falling.

    On Tuesday, Countrywide Financial Corp. said that 9.4% of the option ARMs in its bank portfolio were at least 90 days past due, up from 5.7% at the end of December and 1% a year earlier.

    Washington Mutual Inc. reported earlier this month that option ARMs account for 50% of prime loans in its bank portfolio, but 70% of prime nonperforming loans. At Wachovia Corp., non-performing assets in the company’s option ARM portfolio, which was acquired with the company’s purchase of Golden West Financial Corp., climbed to $4.6 billion in the first quarter from $924 million a year earlier.

    Nationwide, delinquencies on subprime loans — at about 28% as of February, according to First American CoreLogic — remain much higher than for option ARMs. But recent reports from mortgage securitizations suggest that subprime delinquencies have started going bad at a lower rate while delinquencies on option ARMs are speeding up.

    Many borrowers now say they didn’t understand the features of the loan. For example, borrowers who make the minimum payment on a regular basis can see their loan balance grow and their monthly payment more than double when they begin making payments of principal and full interest. This typically happens after five years, but can occur earlier if the amount owed reaches a predetermined level — typically 110% to 125% of the original loan balance.

    Some borrowers say they weren’t suited for these loans or that the terms were poorly disclosed. Edward Marini, a 63-year-old disabled Vietnam veteran, took out a $280,000 option ARM from Countrywide Financial when he refinanced the mortgage on his 2,000-square-foot home in Little Egg Harbor, N.J., in 2005, pulling out cash to pay off some debts. “The way I understood it was that I would have a really low payment for five years,” says Mr. Marini.

    Mr. Marini recently received a note from Countrywide that his payment, now about $1,300 a month, would jump to about $3,800 next year, well above his $3,250 a month in disability payments. Mr. Marini, who owes more than his home is worth, says he was turned down by Countrywide for a refinance and, more recently, for a loan modification. “I didn’t think they would even pull this kind of stuff on someone who is on a fixed income,” he says.

    Whoa, Subprime is old news baby, Option Arm. CNBC talking heads better learn the terms and what they mean.

  8. SG says:

    Down economy gives rise to new-age price hagglers

    By Matt Richtel THE NEW YORK TIMES
    You can negotiate, but you have to do your research. When I’m bargaining, I’m bargaining with information.

    David Achee,

    SAN FRANCISCO— Shoppers are discovering an upside to the down economy. They are getting price breaks by reviving an age-old retail strategy: haggling.

    A bargaining culture once confined largely to car showrooms and jewelry stores is taking root in major stores such as Best Buy, Circuit City and Home Depot, as well as mom-and-pop operations

    Michael Roskell, 33, a technology project manager from Jersey City, N.J., said he and a friend from high school periodically visit electronics stores. While Roskell expresses interest in buying an item, his friend acts as though he is dissatisfied with the price and threatens to leave.

    “We play good cop, bad cop,” Roskell said.

    In February, he said, the friends got $20 off a pair of $250 speakers at 6th Avenue Electronics in the New York area. Earlier, he and the same friend negotiated to buy two 46-inch high-definition Sony televisions at P.C. Richard & Son, a New York-area electronics chain.

    List price: $4,300. Price after negotiation: $3,305.50.

    In fact, Last month, I bargained with PC Richard sales guy and got Refridgerator priced at $550 down to $400, and Microwave Oven from $200 to $130. Bargain Hard.

  9. SG says:

    WSJ Article,

    The Brighter Side of Housing

    And now for the heartwarming side of the housing bust: It’s helping some people buy homes that they couldn’t afford a couple of years ago.

  10. SG says:

    Employment outlook for New York changed to “Very Weak”.

  11. SG says:

    Rising wheat prices mean expensive local slices

    Here in Hoboken, pizza – that time-honored staple – is sometimes regarded as a major food group.

    So the recent news that the price of wheat has tripled over a year, and that grain prices rose 25 percent in February, has many restaurant owners raising prices to make ends meet. Consumers are also wondering how far they’ll have to dig into their pockets to feed their friends and family.

    Perhaps nowhere is the impact of rising prices felt more than in stores that are dependent on wheat, like pizzerias and bread shops.

    A recent survey found that some pizzerias around Hudson County are charging $2 or more for a plain slice, and at least three pizza shops in Hoboken said they now charge $3 for a plain slice.

  12. Everything's 'boken says:

    ‘the number of borrowers who were delinquent on their home loans rose at a slower pace in April than in March. It was the third month in a row in which mortgages went bad at a slower rate. The data ‘

    Decreasing rate of increase fallacy?

  13. Mikeinwaiting says:

    Here you go Grim.

    The Usual News: Home Price Data Remains Grim

  14. SG says:

    View from experts at CNBC

    Moving Up? Luxury Homes Going at Cut-Rate Prices

    Though prices in many regions are still heading lower, luxury home prices in some areas appear to have hit bottom and are starting to rebound.

    “If you’re moving up, it’s a bonanza,” says Ken Baris, president of Jordan Baris Realtors in West Orange, N.J. “The people that end up buying in this period will be seen in 15 years as the geniuses because they’re going to be the ones getting the great buys.”

    “The reality is you want to be very aggressive in trying to find the deals out there and not wasting your time with sellers that are not willing to compromise,” he says. “You can find deals in this market.”

    “The smartest thing a seller can do right now is get a very accurate evaluation of what the true current market value is and price it right there,” Baris says. “I have scores of examples when properties are priced right in this market, the properties sell like a shot. The sellers that want to test the market do not have a great experience.”

    I don’t know what cool-aid this guy is drinking.

    Baris compares the current real estate conditions to the late 1980s, when property values were just beginning a major surge and interest rates were in the 14 percent to 16 percent range. Those who entered the market then were able to refinance their mortgages a few years later when rates plunged, and got more house for less money.

    “Now we have that same opportunity for somebody to go to a neighborhood that had been a million-dollar neighborhood, buy a house, and in five years it’s going to be a million-dollar neighborhood again,” he says.

    In fact, he warns that those looking to sell their homes and downsize ought to wait a few years as the value of their homes increase. A home worth more generally will appreciate proportionately higher than a home of lesser value in the same area.

    “I think this is probably the best time to buy,” Evans says. “With this amount of talent focused on the issue and the public focused on the issue and the clamor for the elected officials to be held accountable for their actions, I think you’re going to see the market go up soon. If you don’t buy now, you’re going to be buying after the market picks up.”

  15. grim says:

    From The Record:

    Region’s home prices off 6.6%

    Home prices in the New York metro area, which includes North Jersey, dropped 6.6 percent over the 12 months ended in February, the Standard & Poor’s Case-Shiller Index reported Tuesday.

    The region’s prices held up significantly better than average prices in the 20 metropolitan areas tracked by the index, which posted a record 12.7 percent drop.

    New York metro prices are about 8 percent below the peak recorded in June 2006. The Case-Shiller Index does not give actual prices.

    In another recent report, Otteau Valuation Group Inc. of East Brunswick, which tracks the real estate market statewide, reported that the volume of home sales in the state dropped 27 percent from March 2007 to March 2008.

    “The clear signal is that the housing market has further to fall,” the report said.

    In Bergen County, Otteau reported that there are more than 6,000 homes for sale, double the 2,900 that were on the market in 2005. In Passaic, there are more than 2,200 homes on the market, double the inventory in 2005.

    At the current pace of sales, it would take about 11 months to sell all the homes on the market in Bergen and Passaic counties, up from three to four months in 2005.

    The Otteau report predicted that the spring season, traditionally the busiest time for home sales, will see only a modest increase in sales activity. And it said that North Jersey, in particular, might be hurt by job cuts predicted on Wall Street.

  16. Mikeinwaiting says:

    Here are a few of the titles from my reading this morn. You can use the link in 13 to read all. “Grim” is the word of the day,
    year, decade?

    Can’t Keep Home Prices from Falling
    No Sign of Bottom in Existing US Home Sale Prices
    From Housing to Employment: We’re in Big Trouble
    Still No Light at the End of the Housing Tunnel
    Higher Property Taxes Could Accelerate Downturn – Housing Tracker

  17. grim says:

    From MarketWatch:

    Mortgage applications fell 11.1% last week: MBA

    Despite a modest drop in interest rates, the volume of mortgage applications filed last week fell a seasonally adjusted 11.1% compared with the previous week, the Mortgage Bankers Association reported Wednesday.

    Application volume for the week ended April 25 was down an unadjusted 14.2% against the same week in 2007.

    Refinance applications decreased 16.7% on a week-to-week basis, while applications filed for mortgages to buy homes were down a seasonally adjusted 4.8%.

    The four-week moving average for all mortgages as tracked by the Washington-based MBA was down 4.3%.

  18. grim says:


    Regarding the Philly foreclosures piece, this is the operative paragraph:

    James Saccacio, the company’s chief executive officer, said that “unusual, nonmarket factors” might be the reason for the drop in this region, citing the city’s April moratorium on foreclosure sales and a program, approved in March, to delay foreclosure proceedings on owner-occupied properties until the owners have met face-to-face with lenders to attempt a loan-workout plan.

  19. bairen says:

    #15 grim,

    Is there any depth to that data?

    I’m wondering if capes, ranches, and small colonials are sitting while the nicer stuff has dropped more then 6.6%.

    The asking prices for our townhouse in Somerset hills is down 20% YOY. I see lots of houses between Basking Ridge and New Providence listing for 15% less then last year. I think Shiller’s data is too conservative or skewed by Manhattan.

  20. grim says:

    I’m wondering if capes, ranches, and small colonials are sitting while the nicer stuff has dropped more then 6.6%.

    There is, it’s in the tiered price index data, I’m working on it now. It’ll be posted up later in the day.

    Very interesting, it seems that according to S&P Case Shiller, the weakness is on the low-end of the market, not the $500k+ range.

    Unfortunately, since the top tier starts with a $500k lower bound, it’s likely that we see at least some sort of top-coding problem develop here.

  21. grim says:

    The tiered index very clearly illustrates the fact that the bulk of the boom was concentrated in the lower-end of the market. The higher end didn’t see nearly as big a run up. Likewise, it’s that low end that is now showing the sharper decline.

  22. bairen says:

    #20 Thank Grim,

    I am really only watching housing below 600k.

    I’m definitely seeing big listing price drops YOY.

  23. bairen says:

    We are thinking about moving to Cranford in the fall if we stay in NJ. Are there any sections to avoid like a “Slummit” in Summit or flood zones?

  24. grim says:

    I know it seems odd, but there appear to be some significant pockets of weakness centered around some very specific price ranges. Of course, this is based entirely on anecdotal information and my own MLS peeping, so weigh it at what it’s worth.

    If I had to put a number, $700k +-$100k seems to be a very weak area. This range is clearly out of reach of the first time buyers, and is squarely move-up territory. However, the move up into this territory seems to be coming from the weakest part of the market.

    All it takes is a simple comparison of what is available in the $500k range with what is available in the $600-700k range. To me, it seems, you get significantly more for your money if you push up into this sweet spot.

    Likewise, there is another “sweet spot” in the $1m new construction range, but for very different reasons.

    This does jive with the S&P Case Shiller tier data. It is entirely possible that these mid-tier homes didn’t appreciate as much as the lower-tier homes, so in comparison, the lower-tier homes seem much more overpriced. That gap was narrowed tremendously, not that either are cheap.

  25. grim says:

    From Bloomberg:

    GM Posts $3.25 Billion Loss on North America Deficit

    General Motors Corp., the world’s largest automaker, reported a first-quarter loss of $3.25 billion after a year-earlier profit because of mortgage losses at a finance unit and plant shutdowns caused by a supplier strike.

  26. grim says:


    My wife loves to point these out to me. She’ll come across a listing priced at $500k, and another around $700k (not that I would consider either). The first listing is a complete wreck of a cape, on a bad piece of property, and the second is a nicely kept, larger, center hall on a nice piece of property. It would be impossible to buy the $500k property, knock down the house, and build a house similar to the $700k property for the same cost. Even if you purchased the lower price property and upgraded the kitchen and baths, you’d bring your net closer to $600k, and not gain a larger home, or better property. Even worse, you put that upgrade capital at risk of loss due to overimprovement.

    If you are forced to buy, maybe buying up is the smart arb play? If the bottom doesn’t fall out, maybe the spread will widen in your favor. If the bottom does fall out, at least you can attempt to ride it out in a house you can stay in long-term. Unfortunately, who can afford to at these prices?

  27. bairen says:

    #26 grim

    Who can afford these prices? And when I look at the data on it’s mind boggling. Median prices are 6 to 10 times median income. What’s really bizarre is that median houses are 6 to 10 times median net worth.

    Have so many people from Chatham to Basking Ridge become wealth destroyers instead of wealth builders? It looks like many people save very little and are basically living paycheck to paycheck.

  28. Cindy says:

    Grim (21) – That is what I was attempting to address the other day with the whole “neighborhood” phenomenon. It is the first-time buyer areas that were overbuilt here in my neck of the woods and sold to the very folks who never had the income and took out the funky loans.

    There has been very little turnover in the more “established” neighborhoods where the buyers bought pre 2000, had the income and took out conventional fixed loans. As long as they didn’t HELOC themselves into oblivion..and evidently they didn’t – there are few sales if any. Those folks are just sitting tight. The price drop doesn’t really “mean” anything to them…they aren’t moving… May not until the kids sell the place 20 years from now.

    That is probably also why cities such as Tracy and Stockton – huge expansion of lower-end housing during that period – got hit so hard. Those homes were filled with poorly qualified buyers at the height of the market taking out unconventional loans.

    It is purely anecdotal on my end – I have not charts etc.

  29. grim says:

    From Bloomberg:

    CDOs Face Downgrades as Losses Prompt Fitch Overhaul

    The market for collateralized debt obligations faces more downgrades as losses on mortgage-backed securities prompt Fitch Ratings to overhaul the way it assesses the risk of CDOs based on company debt.

    Fitch will begin next month to affirm or assign new ratings for about 500 CDOs, the New York-based company said in a statement today.

    “While Fitch expects many ratings to be affirmed, downgrades are also expected, in some cases by several rating notches,” Fitch said in the statement.

  30. grim says:

    Decreasing rate of increase fallacy?

    Most certainly, a useful device.

    It is very easy to word it in such a way that causes the reader to confuse the second derivative with the first. Heck, even when it isn’t intentional, it is easily misunderstood.

    The rate of change is easy, but the rate of change in the rate of change?

  31. 1987 Condo Buyer says:

    $700k+ houses..that is what I would have had to pay to move from my 3 bedroom ranch in CG to a CH or even split 4bdr, say in NC. After closing costs, moving costs and fixing up the “new” house, I decided to add the 4th bdr on to my curreny..and get exactly what we want ….smart move?, I doubt it, but we’ll stay here for another 8-10 years.

  32. twice shy says:

    #23 bairen Says:
    April 30th, 2008 at 7:18 am

    We are thinking about moving to Cranford in the fall if we stay in NJ. Are there any sections to avoid like a “Slummit” in Summit or flood zones?


    Avoid the NE quadrant in the vicinity of Riverside Drive. Major flood zone. Otherwise, the town is stable and unpretentious.

  33. John says:

    Remember when I was talking about Repos a few days ago, well the news last night had a big story on the huge amount of repos in New Jersey. This guy owns a repo business and is making tons of money and has yards full of them getting waiting to get auctioned off. Well the owner tells him I am about to Repo a celebs car do you want to come with me? Can’t tell you name till we get there, report goes sure goes with camera crew and they go to hook a 300K rolls/bentley that little kim the rapper is six months behind, little kim comes out and see the camera crew and starts yelling F you and F that, it was priceless to see little Kim on the steps of her mansion getting her rolls repo’d.

  34. Everything's 'boken says:

    ‘Most certainly, a useful device.

    An example:
    price of an item increases from $1 by .50 a year forever.

    First year rate of increase is 50%, year 2 only 25%. Cut by half! Such wonderful news!

  35. Everything's 'boken says:

    Oops. 33

  36. John says:

    Hampton homes falling, I said it a year ago when hampton homes start to drop we are begining to enter the real fall in home prices, next up NYC. You need the last two areas where people believe it can’t happen here to fall to get the death spiral going.

  37. bairen says:

    #32 twice shy

    Thanks for the info. In a few weeks we are going to start going to the downtown and hitting some open houses. I doubt we will buy till next year. I’d rather live in the town for 6 months or so first to see if we like it.

  38. BC Bob says:

    “Soaring global food prices and reluctant donors are pushing North Korea back towards famine, which could see the secretive government turn even more repressive to keep control, a paper released on Wednesday said.”

    “The country is in its most precarious situation since the end of the famine a decade ago,” said the paper from the Washington-based Peterson Institute for International Economics.”

  39. grim says:

    From MarketWatch:

    U.S. Q1 GDP rises 0.6% vs. 0.2% expected
    U.S. Q1 final domestic sales fall 0.4%, 1st drop in 17 years
    U.S. Q1 core inflation rises 2.2%; up 2.0% in past year
    U.S. Q1 consumer spending up 1.0%, weakest in 7 years
    U.S. Q1 business investment falls 2.5%, weakest in 4 years
    U.S. Q1 residential investment down 26.7%, worst in 26 years
    U.S. Q1 growth due to inventories, consumers, exports

  40. grim says:

    Inventory growth isn’t anything to be happy about..

    From Bloomberg:

    U.S. Economy Grew at 0.6% Pace in First Quarter on Inventories

    The U.S. economy expanded at a 0.6 percent annual pace last quarter, reflecting an increase in inventories as consumer spending slowed, investment dropped and the housing slump deepened.

    The gain in gross domestic product, the sum of all goods and services produced, was more than forecast and matched the pace of growth in the previous three months, the Commerce Department reported today in Washington. The last time the economy grew less was in the fourth quarter of 2002.

    Spending by households, the biggest part of the economy, grew last quarter at the slowest pace since 2001, when the U.S. was in a recession, as job losses mounted, food and fuel prices surged and property values tumbled. Federal Reserve policy makers are forecast to cut the benchmark interest rate today to limit the downturn.

    “The economy is struggling, it’s not going anywhere fast,” Mark Zandi, chief economist at Moody’s in West Chester, Pennsylvania, said before the report. “The fundamental problem is the declines in home values and resulting impact on the financial system that’s weighing sharply on the consumer.”

    The economy would have contracted last quarter if not for an increase in inventories that was probably caused by the slowdown in sales.

  41. BC Bob says:

    This bull market never dies in Hudson County;

    “Mayor and His Wife Are Guilty in Federal Extortion Case in New Jersey”

  42. BC Bob says:

    Another bull market, Christopher Christie. Still undefeated.

  43. R Patrick says:

    Back when I was the emissary of Grand Fenwick, I was scouting out a property for the embassy on US soil after that unfortunate Q bomb incident involving my friends …

    Nah I can’t sound as pompous as him, I tried and failed. :)

  44. gary says:


    Can you give me a status on 121 Greenbrook Road, North Caldwell?


  45. SG says:

    Grim – I am not sure about your observation of weakness at low end of market. When I look at home sales with in last 3 month in central NJ towns, I see significant more volume for houses below $500K compared above $500K houses. Granted number of middle class houses are more in number than higher end ones. But at the least, lower priced homes are selling, while houses in higher bracket are just sitting on MLS forever.

    The biggest trouble in comparing statistics is there is no way to quantify quality and location of the house. Doing range based analysis is wrong in itself as prices have moved so much (at least 10% to 25% with in 2 years), using that as range gives misleading statistic. The example you mentioned where $700K house looks much better than $500K, does not give any adjustment to location.

  46. grim says:

    If the government can report Inflation ex. Inflation, and Unemployment ex. Unemployment, I can at least talk about GDP ex. Private Inventories.

    Which was squarely in recession territory at a negative 0.2%.

    Inventory growth added 0.81% to the GDP, pushing up to 0.6%. Given the decline in consumer spending and a looming recession, both nationally and internationally, inventory growth isn’t a good sign. Inventory adjustment cycle? Fat inventories + Fewer Sales = More Layoffs + Lower Production.

  47. 3b says:

    #21 grim: How would we break that information down price wise? Just curious, is it the 350 to 650K range where the inflation took place.

    And lets say the 650 to 1 million and over was less inflated?

    Because one could argue too that there have been many listings out there asking 1 million and over, and those asking prices were just as inflated

  48. Hobokenite says:

    bairen (19),

    Is there any depth to that data?

    I’m wondering if capes, ranches, and small colonials are sitting while the nicer stuff has dropped more then 6.6%.

    The asking prices for our townhouse in Somerset hills is down 20% YOY. I see lots of houses between Basking Ridge and New Providence listing for 15% less then last year. I think Shiller’s data is too conservative or skewed by Manhattan.

    First of all, it’s unlikely to be skewed by manhattan, since CS doesn’t include condos (or co-ops probably).

    Anyway, I was wondering the same thing. I’m hearing reports of huge (50%) drops in other areas of the country that don’t seem to mirror the CS data. My thinking was maybe since CS is based on repeat sales, they aren’t getting a lot of sales yet from the peak of the market.

  49. grim says:


    The tiered index brackets aren’t defined in a way that would make them an ideal tool for this area.

    Low Tier – Under $344,998
    Mid Tier – $344,998 to $500,674
    High Tier – Over $500,674

    Like I said, we’re going to see a top coding problem in this area. A large number of the sales we’re interested are going to be in the high tier, and we have no way to peek into that. Unfortunately, the $505,000 POS Cape gets lumped in with the $15,000,000 Alpine Faux Chateau.

  50. Essex says:

    This is what the mfg corp elite have based their cost savings on:

    Thousands of children are being sold “like cabbages” to China’s booming factories as virtual slave labor.

    Young people, some younger than 10, are said to have been discovered being bought and sold at a street market in one of rural China’s most overpopulated provinces, Sichuan.

    According to investigative reporters, the children stood in line as they were assessed like cattle, before being driven to factories in China’s manufacturing heartland, the Pearl River Delta.

    A newspaper based in the delta, Southern Metropolis Daily, suggested that abuses remain rampant in factories despite efforts by campaigners within China and abroad.

    The abuses might have become worse as wages have finally begun to rise in recent years, prompting businesses to seek new ways to cut costs.

    The newspaper was tipped off by residents living close to the street market. One local man said he had watched children being “sold like cabbages.”

    One reporter, posing as a clothing factory manager, was allowed to inspect would-be “employees” by patting their arms and stomachs. He agreed to pay them three and a half yuan an hour — about 50 cents.

    Many had fake papers saying they were older than 18; but, when asked, most said they were between 13 and 15. One was just 7, another 9.

    The newspaper said many came from the same area of Sichuan, Liangshan County, where 76 children have been reported as missing since the Chinese New Year in February.

    One of the most disturbing findings was that local officials seemed to be complicit. A foreman, who produced officially stamped documents concerning the children, said: “We have the complete right to manage them, by any means. You only need to sign a work agreement with us.”

    The newspaper was told stories of hundreds of children being sent to electronics and toy factories across southern China.

    Southern Metropolis Daily is part of the most adventurous newspaper group in China. Although run by the local government, it is encouraged to make money and breaks genuine stories to do so. Its staff have paid the price in the past, with a number of employees jailed on dubious bribery charges.

    On this occasion, some of the allegations have been confirmed by the government’s central mouthpiece, the Xinhua news agency.

    In a similar case last year, hundreds of young men were found to be working as slave labour in a string of brick kilns across northern China. Lured with promises of high wages, they were locked up and, in some cases, beaten to death.

    According to reports from Sichuan, some of the foremen in the latest case have now been arrested and efforts are being made to return children to their parents.

  51. 3b says:

    #49 grim: Got it. Thanks.

  52. grim says:


    The data is interesting, and certainly worth a look, while not ideal I don’t think we should just dismiss it. Hopefully, I’ll have something to post later in the day.

  53. Mike NJ says:


    Thanks for the plug. That was actually me in that article in the NYT on bargaining.


  54. grim says:


    Where was that listed?

  55. 3b says:

    #52 grim: Thanks again for all your help. I just made a donation to your site, which is soemthing I had been meaning to do for quite some time. I finally took the time and did it.

    Once again thank you for all of your time effort, help, and general good cheer in maintaining this site. All the best.

  56. Pat says:

    Mike, where’s the best place to haggle for a TV?

  57. grim says:

    Thanks, I appreciate it.

  58. gary says:

    grim [54],

    Good question. lol! It was on the market for at least a year and a half. Re-listed a few times and then it recently disappeared. I don’t know if it went UC or just fell through the cracks.

  59. gary says:


    The Address might be 121 West Greenbrook Road instead of just Greenbrook Road.

  60. BC Bob says:

    Griffin, Black and Moelis. Some of the titans of the industry. Not comforting for a mold coast seller.

    “Investors see recession, Wall Street depression”

  61. grim says:


    Went UC on 4/13

  62. 3b says:

    #60 BC Bob: I do not agree with their belief that the recession is going to be that mild or brief.

    Yes there are pockets that will do well, those areas that depend on commodities to power theri local economies (like Pittsburg)

    But on a whole our economy is predicated on consumer spending. The consumer is tapped out, that will IMO make this recession quite severe.

    I belive we were in much better shape to weather a refession in the ealry 90’s then we are today. A that time we did not have the huge over hang of consumer debt that we have today.

  63. NJGator says:

    Got my monthly compiled listings from the GSMLS today. There are now 6 3+ bedroom homes in Millburn listing for less than 500k. By this time next year, there might even be homes we’re willing to live in in this price range.

    Can someone with GSMLS access please give me the status of the following in Millburn? I’m wondering if they went UC or were withdrawn. Thanks.


    4 Haran Circle
    356 Wyoming Ave

  64. Hard Place says:

    Some good RE discussion going on here, starting with those posts in the 20’s…

    In the top towns if you have more than 2 kids, you’ll need a 4BR home and those are easily priced above 600k with the nice looking ones in the 800k range.

    That Lil’ Kim story is classic. She’s got bad karma written all over her, so she gets what is coming to her. Somebody should youtube that news clip.

  65. SG says:

    Be prepared to lower price to sell your home

    “Buyers just want price,” says Mike Morgan, a Stuart, Fla.-based lawyer, real-estate broker and consultant who researches property markets for hedge funds and financial institutions. “Buyers have become educated and they can easily cut through the fluffy incentives.”

    Morgan doesn’t see any national rebound until at least 2010; maybe longer if builders keep constructing homes, and if banks continue dumping foreclosed properties on the market.

    Living near a foreclosed home may even trim as much as $5,000 from your own home’s market value, the center says. Some 44 million households will be affected, or about a third of all U.S. housing units.

    “On one $429,000 home a client wanted me to sell, the seller wanted to give the broker a $30,000 bonus on top of the commission. I told him it wouldn’t help. I told him to just drop the price.”

    Because the market is so price-sensitive — buyers want bargains and sellers want to get prices they saw at the market’s peak — you have to be flexible when advertising your home.

    “If you don’t get any calls on your listing price after a week, drop your price $10,000 or about 2 percent of your original asking price,” Morgan says.

    “The market will tell you what the price of your home is. You better be priced 10 percent under your competition — and then be prepared to think about accepting offers under that.

    “People were telling me Boston and Seattle were OK,” said Morgan, who recently visited both cities. “I’ve got news for those folks. They aren’t OK.”

    To sell those houses, they have to offer steep discounts. They will be advertising and doing anything they can to attract buyers. It will take more than balloons and donuts, though, to land the number of buyers they need to stay in business.

  66. gary says:

    grim [61],

    Thanks. I loved that house… obviously out of my price range. I wonder what price it went UC for?

  67. BC Bob says:

    Dead mank walking.

    BOSTON (MarketWatch) — Federal Deposit Insurance Corp. Chairwoman Sheila Bair will propose the government be allowed to offer loans to homeowners, marking the latest move to help strapped borrowers and the floundering mortgage market, the Wall Street Journal reported Wednesday.
    The FDIC’s expected proposal would allow the Treasury Department to issue loans to close to 1 million homeowners, according to the report citing a confidential draft of the plan. The loans would let borrowers pay off up to 20% of principal they owed on their mortgages.

    Borrowers would not have to make any payments on the Treasury loans for the first five years, the newspaper said.
    The FDIC estimated it would require a $50 billion public debt offering in order to modify 1 million loans, according to the report.

  68. BC Bob says:

    That’s dead man.

  69. grim says:

    Borrowers would not have to make any payments on the Treasury loans for the first five years, the newspaper said.

    Why does this reek of a “Buy now and make no payments until 2013!!!!!” scheme.

    $50 billion, eh? That must be why my wallet is in pain this morning.

  70. Nom Deplume says:


    since you asked yesterday–

    Criteria was a lower cost house in higher end neighborhood, around the corner from decent elementary school, in a town ideal for raising a young’un, that is the first high-end town on the Raritan line. Lower cost means I can get in with conforming loan and pay the rest, keeping the rate down. HELOC for renos comes at lower interest rate and I have it backed with cash anyway, and with effective taxable yield on munis higher than the HELOC, it makes sense to keep the cash. I figure this lowers my overall housing costs, which is the figure I always considered relevant–people never consider how much interest over time adds to their housing cost. Instead of paying about 1.1 MM over 30 years, I will probably pay less than 900K (with taxes being the wild card).

    Bit small for my taste, but I recently sold a 1400 sqft rowhouse in Philly, so this is larger, to be sure. Also, we figured the house we wanted spacewise would cost us 750-850 anyway, so we bought a smaller house that could be expanded. Will spend the same $$ and get the house we want in the hood we want.

    Agonized over it to be sure as I am a RE bear, but my time horizon is 15-20 years in this location, I am still able to hoard cash, and I did not think I would do much better before school starts.

    Seller wants quick close, but I am not in any hurry to be a NJ taxpayer.

  71. NJGator says:

    Gary – I’ve seen that house many times. That’s a beautiful area. We drive through it every time we take our dog to the Rover Ranch and Spa.

  72. Mike NJ says:

    #56 Pat,

    I personally prefer PC Richard. You can haggle the hell out of them and they expect it. BB and CC sales people have limited (to no) ability to set prices. PC Richard and 6th Ave Electronics will all work with you down to the last dollar. I went down and bought the new iMac on Monday night and even the Apple store in short hills mall worked with me. They would not drop the price of the computer (I never expected them to) but they gave me a free .mac account and a major discount on the applecare warranty. I even got a free printer also but that was part of an existing promotion. I find a lot of places will drop down a peg once you ask them to. I even got my termite insurance to drop 10% by asking but I wanted a bigger discount so I told them no thanks.

  73. John says:

    So can I just borrow 20% for the heck of it and prepay my mortgage by 20%?

  74. make money says:


    What news channel did you see that on. I would love to see it on you tube or perhaps on their website.

    I love th erepo business especially at these times.

  75. John says:

    Best way is to haggle them all down to rock bottom and then use a service like buyers edge to beat the rock bottom price. I will never use PC richards again, they sold me a serial number removed GE oven and then GE refused service and told me it was a return and PC richards refused service saying I most have peeled sticker off, the thing worked when I got it.

  76. John says:

    Repo thing was on 10 pm news, I think channel 11, I laughed my butt of watching Little Kim outside her NJ mansion throwing F bombs at the reporter.

  77. BC Bob says:

    “throwing F bombs at the reporter.”


    The Bronx cheer.

  78. Pat says:

    Thanks, Mike.

  79. Pat says:

    John, the stuff is disposable these days, anyway.

    It’s not like in the 70’s, when you bought something like a washer and it was half your income for months, but it would last 20 years.

    Now the stuff is made to last two’s all about the price. Just like McMansions.

    What’s better…a two thousand dollar thing that will last ten years, or a $500 buck thing that will last two years?

  80. Hard Place says:

    Nom – That’s a good plan. I was planning to do something similar. Buy home on underutilized plot in top town and expand to my needs. The HELOC and muni investment was not something I thought about, but that’s an interesting concept to look into.

  81. Rich In NNJ says:

    Bob (41),

    Ha! I know relatives of these people. It’s a pretty funny story.

  82. John says:

    Have you checked out fridges lately they are like 2-3K and good ovens are 1-2K. Things today are crap, my mothers orignal to the house 1923 electric washer that you filled wtih a hose and had a clip on device you turned to squeeze out the water worked like a charm when we got rid of it in 2004. My mom washed rugs in the damm 80 year old washer, sure it cost a lot new but it was worth it.

  83. gary says:

    Edward Marini, a 63-year-old disabled Vietnam veteran, took out a $280,000 option ARM from Countrywide Financial when he refinanced the mortgage on his 2,000-square-foot home in Little Egg Harbor, N.J., in 2005, pulling out cash to pay off some debts.”

    “‘The way I understood it was that I would have a really low payment for five years,’ says Mr. Marini.”

    “Mr. Marini recently received a note from Countrywide that his payment, now about $1,300 a month, would jump to about $3,800 next year, well above his $3,250 a month in disability payments. Mr. Marini, who owes more than his home is worth, says he was turned down by Countrywide for a refinance and, more recently, for a loan modification.”

    “‘I didn’t think they would even pull this kind of stuff on someone who is on a fixed income,’ he says.”

    It’s a great time to buy because interest rates are at historic lows and there’s plenty of inventory. Do I have that correct, realtors?

  84. make money says:,0,6551865.htmlstory

    Here’s the news clip. It’s kinda funny. The reporter could have done a better job but it seems like he was scared.

  85. Mikeinwaiting says:

    BC 41 Rich 82 I know relatives of them to.
    I grew up around there. My Aunt sat with them at a party at Villa Amalfi about a month ago. Guttenburg is a wild town. Any of you guys experience to “The Cove” back in the day?

  86. gary says:



  87. BC Bob says:

    “The Cove”

    miw [87],

    Not me. I was spending all my time in Belmar, DJais. Holme, the garden state boogie.

  88. lisoosh says:

    Pat/Blood – what are good sources of rental info in Bucks + details of decent towns?

    Think I’m done with Jersey, a friend wants to look there too and her hubby works in Trenton. A years rental would be a good way to give it a try risk free.

  89. NJGator says:

    Just in case no one saw it further up on the thread, can someone with GSMLS access please give me the status of the following in Millburn? I’m wondering if they went UC or were withdrawn. Thanks.


    4 Haran Circle
    356 Wyoming Ave

  90. kettle1 says:

    dave berry on economic stimulus

    Q. What is an Economic Stimulus Payment?

    A. It is money that the federal government will send to taxpayers.

    Q. Where will the government get this money?

    A. From taxpayers.

    Q. So the government is giving me back my own money?

    A. Only a smidgen.

    Q. What is the purpose of this payment?

    A. The plan is that you will use the money to purchase a high-definition TV set, thus stimulating the economy.

    Q. But isn’t that stimulating the economy of China?

    A. Shut up.

  91. Mikeinwaiting says:

    BC 89 Did the Belmar thing too. This was a lets say unique bar for gentlemen, using the term loosely.

  92. Tom says:


    Call FDIC chairwoman – Sheila Bair’s office
    # (202) 898-6974.

    Let her know that we do not appreciate of her coming up with these crazy market manipulating ideas. Let the Market correct itself.

  93. BC Bob says:

    Tom [94],

    I agreee, bombard them with emails also.

  94. kettle1 says:

    it looks like maybe someone is actually listing at something approaching a realistic price, at least not at 05 prices.

    I found this house the other day by chance.

    84 main st califon nj
    asking 387K

    purchased 06/98 for $260K
    3% annual Appreciation puts the house at about $350K in 2008

    if we go for the 04 $ value of the house as some people on here suggest then the house would be about 310K

    this house looks like a good candidate for challenging the tax evalution from 06 @ 462K

  95. Outofstater says:

    #50 Essex – I believe it. I used to work with a guy who was born in mainland China in the fifties – you would not believe some of the horror stories he told. And in a tone of voice that we would use to describe the most boring aspects of our lives. It was chilling. It really is another world there – where life is cheap.

  96. BC Bob says:

    Kettle [96],

    Not bad. One possible negative, would you be within launching distance of Clot?

  97. Confused In NJ says:

    67. BC Bob Says:
    April 30th, 2008 at 9:58 am
    Dead mank walking.

    BOSTON (MarketWatch) — Federal Deposit Insurance Corp. Chairwoman Sheila Bair will propose the government be allowed to offer loans to homeowners, marking the latest move to help strapped borrowers and the floundering mortgage market, the Wall Street Journal reported Wednesday.
    The FDIC’s expected proposal would allow the Treasury Department to issue loans to close to 1 million homeowners, according to the report citing a confidential draft of the plan. The loans would let borrowers pay off up to 20% of principal they owed on their mortgages.

    Borrowers would not have to make any payments on the Treasury loans for the first five years, the newspaper said.
    The FDIC estimated it would require a $50 billion public debt offering in order to modify 1 million loans, according to the report.

    This plan basically shows that the Bankrupt USA has no options left.

  98. kettle1 says:


    Dont forget about my bunker! no problem when you have a hardened bunker installed!

  99. Mikeinwaiting says:

    Ket 96 Looks nice, don’t know anything about town or area but I love the house if the pics hold true.

  100. kettle1 says:

    i lived in califon, and i personally think the area is quite nice. most people would have a serious commute from there, but it depends on what you are looking for.

    if it or similar homes are still on the market in 1 year may seriously consider them. but its still to early in the game for me. there is still to far for the market to drop for me to jump in yet. Although it is tempting!

  101. kettle1 says:


    do you have any info on the 2 homes that come up as foreclosed in califon, 1 on phillhower and 1 on river rd?

  102. kettle1 says:

    Dont worry, the economy is fine and will turn around by fall.

    Americans unload prized belongings to make ends meet

    By ANNE D’INNOCENZIO, AP Business Writer Tue Apr 29, 6:04 PM ET

    NEW YORK – The for-sale listings on the online hub Craigslist come with plaintive notices, like the one from the teenager in Georgia who said her mother lost her job and pleaded, “Please buy anything you can to help out.”

    Or the seller in Milwaukee who wrote in one post of needing to pay bills — and put a diamond engagement ring up for bids to do it.

    Struggling with mounting debt and rising prices, faced with the toughest economic times since the early 1990s, Americans are selling prized possessions online and at flea markets at alarming rates.

    To meet higher gas, food and prescription drug bills, they are selling off grandmother’s dishes and their own belongings. Some of the household purging has been extremely painful — families forced to part with heirlooms.

    “This is not about downsizing. It’s about needing gas money,” said Nancy Baughman, founder of eBizAuctions, an online auction service she runs out of her garage in Raleigh, N.C. One former affluent customer is now unemployed and had to unload Hermes leather jackets and Versace jeans and silk shirts.

  103. 3b says:

    #90 lisoosh: Think I’m done with Jersey.

    Oh No!! You too? Why? )Probably a stupid question.)

  104. kettle1 says:


    You have to wonder who might be using this board as a source. The level of the posts and conversations here is higher then most such boards i have come across. I believe that grim has caught newspaper pulling from him before also if i remember correctly….

  105. kettle1 says:

    when a house is listed as having a cesspool for sewage, is that the same as a septic tank?

  106. grim says:

    Given the fact that I routinely push the limits of fair use, the media can use whatever they’d like. They won’t get a cease and desist from me. Speaking of which, I’m due for another.

  107. Pat says:


  108. John says:

    If people move every seven years (or so they say) and we are going back to 2002 prices that means every home purchased from 2003-2008 will be worth less than the owner has paid for the house. 6 out of 7 homeowners underwater, cool beans. I doubt that is true but stats are funny you can make them say what you want. Kinda like saying the aveage person who have been in their house over 7 years has seen their home price more than double. As if to imply buy in 2008 and by 2015 you will have doubled your money. Prices are not that important, it is inventory and sales. Until people start buying and inventory falls pricing will be ilquid and comps won’t mean anything.

  109. BC Bob says:

    “when a house is listed as having a cesspool for sewage”


    ARM, piggyback, I/O, 80/20, pay option, neg amort, zero down?

  110. bairen says:


    “when a house is listed as having a cesspool for sewage”

    Break out the deck chairs and the water polo nets.

  111. Mike NJ says:


    Those are some strong words. They guy has a point but seems a bit alarmist. After reading his post, one thing comes to mind…location, location, location. Buy in a location that can withstand the crush. I sure hope I did but only time will tell. I think many of those that chose the cheaper/bigger home farther away from the area employment center will see their prices drop the fastest and deepest. I worry about a severe downturn like most homeowners but the numbers that this guys talks about I think will be reserved for the places that indeed were not properly priced in the grand scheme of things.

  112. x-underwriter says:

    kettle1 Says:
    it looks like maybe someone is actually listing at something approaching a realistic price, at least not at 05 prices.

    That is a nice house and I’m willing to pay $20,000 over whatever offer you come up with…wait I just started a bidding war.

    Seriously, watch the 3/1…might get a little cramped. I like Califon. The commute is tough though

  113. x-underwriter says:

    kettle1 Says:
    when a house is listed as having a cesspool for sewage, is that the same as a septic tank?

    Nope. Cesspool is a tank that holds all the $hit. You have to get a truck in and get it pumped regularly. Enjoy that going on.
    Septic spreads it out under you lawn and it all biodegrades naturally. Expect alot of those up in Califon area

  114. Hehehe says:

    “One thing we can count on is that as consumers are forced to de-lever many will likely see a decline in living standards because so much of household cash flow has been financed by credit. That’s when we will see the political and social reverberations of de-leveraging. For starters, take it as a given that most consumers won’t blame themselves for the end of dream.”

    I can’t believe he’d say that about Americans.

  115. kettle1 says:


    the house is yours my friend. We have discussed different negotiation styles, and mine does not include bidding wars. There will always be another house.

    Re septic:

    I have had septic in most of the places i have lived, as well as well water. I do not mind either. I would consider having a septic installed if there were no prohibiting factors on that property

  116. kettle1 says:


    My hope is that the economic $hit storm that is just beginning to rain down on the US will bring out the character in people that was exemplified by our founders. it may be a long shot, but adversity tends either bring out the best or the worst in people, i hope for the best and plan for the worst

  117. Confused In NJ says:

    MLS#: 2511272 Price: $569,000 . This house in New Providence is priced at 2003 prices. Nice house in ArchGate section, walk to school, park & train.

  118. BC Bob says:

    The Anti-Bill Gross;

    “Must Government Inflate Home Prices?”

  119. Hehehe says:


    It being America, count on the worst.

  120. kettle1 says:

    hold on boys we (the economy) are going in!

  121. Dman says:


    Wow, locksmiths are experiencing an increase in business from having to make new keys to the Repo’d cars.

  122. Confused In NJ says:

    MLS#: 2511638 Price: $459,000. This Berkeley Heights TownHouse in Berkeley Meadows is priced at 2003 prices. Nice location on Meadowview Lane. Was originally on for @ $629K.

  123. kettle1 says:

    i’m sure everyone has seen this image before, but i nominate this image as the official logo of the US home owner, underwater but focused on the important things

  124. Hard Place says:

    GSMLS Inventory Officially at 36,031…

    We’ve passed 36k before the peak summer season.

  125. Dman says:

    #23 Bairen,

    Stay away from the northern part around nomahegan park, its a flood zone.

  126. lisoosh says:

    3b Says:
    April 30th, 2008 at 12:50 pm
    #90 lisoosh: Think I’m done with Jersey.

    “Oh No!! You too? Why? )Probably a stupid question.)”

    Husbands work is slow and he is getting fed up. And just tired of busting his @ss and going nowhere. I used to make quite a bit more than him but at my age + 2 kids + 6/7 years out of the workforce, I won’t be making any money in a hurry. I have a couple of businesses I am setting up, neither of which is location specific but I do need a workshop/barn and more space in order to get them up and running.

    We don’t have debts, have money in the bank and live fairly frugally so we’re fine, but in order to move forward, something has to give. A good sized rental from which he could commute until he finds something local would work out well.

    Also looking at other areas entirely – I’ve shortlisted Eugene Oregon (Cindy?? what do you say?), Austin Texas (but not sure about the heat/humidity/allergies) and New Mexico. Liberal, more affordable and decent sized Jewish communities. Ithaca NY appeals too but I think the winters would be too chilly.

    I think I’m just done with the big hair, big egos, big talk and big taxes. We’ll see. But I don’t want to become someone elses bagholder.

  127. grim says:

    Benny, you’re on in 5!

  128. Hard Place says:

    Just took at the lil’ kim bentley repo clip. I want to see the unedited full length version where she opens the door cursing out the reporter with her little pasties on…

  129. grim says:

    Polish central bank holds at 5.75%, what will Bernanski do?

  130. chicagofinance says:

    Fed goes 25 bps….

  131. grim says:

    Vote is 8-2 to cut 25 bps

  132. BC Bob says:

    At least Fisher and Plosser get it.

  133. x-underwriter says:

    kettle1 Says:
    the house is yours my friend.

    I googled Califon to where I work…42 miles.
    I’ve done that before…never again, especially with $5 gas coming up
    Oldwick is max distance…10 miles less.

  134. Hard Place says:

    Off to the races. Dow above 13k again. What recession?

  135. BC Bob says:

    “This is not about downsizing. It’s about needing gas money,”

    From [105],

    Don’t worry about downsizing. The fed sees inflation risks moderating.

  136. ledward says:

    May I ask a genaral question?

    If the home inspection report suggests “Have the system serviced and repaired as necessary”, but seller refuses to have it serviced because it is kind of maintenance. What could buyer response? Thanks

  137. John says:

    are all looking for college educated stay at home moms with prior business experience for short flexible high paying gigs. just an fyi to the ladies at home looking for CASH.

  138. rhymingrealtor says:

    Hard Place

    We did’nt reach 36,0000 last year until oct. Looks like 40″ is really the new 30″


  139. gary says:

    FOMC: Inflation Moderating


  140. njpatient says:

    125 kettle

    Where’d you find that?

  141. grim says:

    From the FOMC:

    The Federal Open Market Committee decided today to lower its target for the federal funds rate 25 basis points to 2 percent.

    Recent information indicates that economic activity remains weak. Household and business spending has been subdued and labor markets have softened further. Financial markets remain under considerable stress, and tight credit conditions and the deepening housing contraction are likely to weigh on economic growth over the next few quarters.

    Although readings on core inflation have improved somewhat, energy and other commodity prices have increased, and some indicators of inflation expectations have risen in recent months. The Committee expects inflation to moderate in coming quarters, reflecting a projected leveling-out of energy and other commodity prices and an easing of pressures on resource utilization. Still, uncertainty about the inflation outlook remains high. It will be necessary to continue to monitor inflation developments carefully.

    The substantial easing of monetary policy to date, combined with ongoing measures to foster market liquidity, should help to promote moderate growth over time and to mitigate risks to economic activity. The Committee will continue to monitor economic and financial developments and will act as needed to promote sustainable economic growth and price stability.

    Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Timothy F. Geithner, Vice Chairman; Donald L. Kohn; Randall S. Kroszner; Frederic S. Mishkin; Sandra Pianalto; Gary H. Stern; and Kevin M. Warsh. Voting against were Richard W. Fisher and Charles I. Plosser, who preferred no change in the target for the federal funds rate at this meeting.

  142. John says: is the place to hit for telecommuting flex time mommy wall street jobs. Hint Hint 85 Broad is Goldman, but lots of wall street and banks advertise there.

  143. njpatient says:

    131 ‘soosh

    You’d probably really like Austin (allergies aside). My died-in-the-wool NYC parents spent a year there (teacher exchange) and LOVED it.

  144. njpatient says:


    “FOMC: Inflation Moderating”

    ah – but what’s it moderating…?

  145. John says:

    Re 141 depends if you are paying above market or below market. Last house we sold to a buyer at a good price starting dickering about chimmny cleaning type nonsense and wanted us to pay, took the slightly higher off instead as if I have to do nonsense I want to get paid for it. If you are paying market price and the owner does not have a back up buyer, tell him you are walking if he don’t pay.

  146. Yield on the 10yr is up (2 and 5 as well). Countering for inflation?

  147. kettle1 says:

    has anyone else noticed the MS recently? I watched the morning news for the first time in months today. I swear that the MSM is attempting to mimic the fictional Ministry of Truth. The MSM take on the economy and what is happening is so far off the real events as to almost qualify as entertainment! and we wonder why the general public has no idea what is going on.

    “Men fear thought as they fear nothing else on earth — more than ruin — more even than death…. Thought is subversive and revolutionary, destructive and terrible, thought is merciless to privilege, established institutions, and comfortable habit. Thought looks into the pit of hell and is not afraid. Thought is great and swift and free, the light of the world, and the chief glory of man.”

    Bertrand Russell

  148. gary says:


    Inflation’s moderating everybody’s pockets.

  149. Clotpoll says:

    vodka (104)-

    Sorry, no info at hand. Hunterdon filings aren’t online. You have to go to Flemington and deal with the most f-ed up county clerk’s office in NJ.

    I only go once every few weeks. Every time I go, I swear to myself it’ll be the last time.

  150. kettle1 says:


    it was from a ship that passed near one of the 2006 hurricanes i believe

  151. lisoosh says:

    njpatient Says:
    April 30th, 2008 at 2:30 pm
    131 ’soosh

    “You’d probably really like Austin (allergies aside). My died-in-the-wool NYC parents spent a year there (teacher exchange) and LOVED it.”

    Allergies AND Heat and Humidity. Killer combo.

    I know I’d love it though my experience totals 2 days. Good food, good beer, good nightlife, liberal outlook, multiple festivals, green, good public transport, affordable housing. What’s not to like, apart from all the Californians moving out there, but I don’t mind Californians anyway, I like loopy.

  152. lisoosh says:

    John. I do have to say, you constantly amaze me.

  153. gary says:

    What’s the under/over on the time line when I receive the first email from a realtor telling me that mortgage rates will be even better now since the FED has dropped the rates once again.

  154. Trader says:

    122 & 127 Confused In NJ

    Thank you for advertising the new listings from your office. Both places are expensive. I hope your seller’s come to their senses before they lose more $$

  155. njpatient says:

    153 gary


  156. ledward says:

    #150, thanks John. This is not a super deal, just a reasonable one. But if we walk away, we will lose attorney and inspector cost, which could be higher than the cost of services. And, could it be the excuse to withdraw?

  157. BC Bob says:

    The US consumer should sue the fed; treason and fraud.

  158. rhymingrealtor says:


    I got one yesterday anticipating the drop!


    Inspection clause could get you out. Possibly

  159. njpatient says:

    156 soosh
    it’s the humidity that does me in.
    I lived in LA for a year and had a friend explain to me why CA is so loopy: “Once a year, G*d picks up the US by grabbing Cape Cod, gives the country a couple of shakes, and all the loose people trickle down to CA.”

  160. gary says:


    It’s inevitable.

  161. lisoosh says:

    njpatient Says:
    April 30th, 2008 at 2:56 pm

    “it’s the humidity that does me in.”
    “and all the loose people trickle down to CA.””

    Yup, that’s why NM would be fine, desert heat doesn’t bother me, just stay out of the noon day sun (mad dogs and Englishmen and all that).

    I like the CA quote – definitely, the “loose” people. Always something to see though.

  162. BC Bob says:

    S&P’s now lower. Benny, Benny come back for an encore.

  163. make money says:

    am so cheap that I don’t even enter office pools or buy a lottery ticket when the prize tops $100 million, so I will pass on your wager.

    Good Call. Office pool? I thought you’re a rich guy who flies charter planes to Bermuda? you actually have to work for a living everyday?

  164. kettle1 says:


    be aware that the southwest is just starting to enter what will most likely be a decades long dry spell. What issues are going to become severe over the next several years. the available water supplies are predicted to not be sufficient for local population in 2 – 5 years depending on the city. FYI

  165. kettle1 says:


    Water issues are going to become severe over the next several years

  166. kettle1 says:


    if you are interested…..

    Study Sees Drought Trend in U.S. Southwest (NPR)

    one of many sources.

  167. Everything's 'boken says:

    re: cesspool

    This suggests the possibility of a failed septic system with insufficient space or unsuitable soil for a replacement.

  168. kettle1 says:


    the cesspool thing is a definite red flag for me. i would do lots of digging (no pun intended) on that

  169. 3b says:

    #158 gary: Just talk to the Realtors about the difference between short and long rates, and how the Fed onoy controls the short end of the curve. And the market controls the long end,and how 30 yr fixed rated mtgs are based off of the 10 yr treasury. That will shut them up.

  170. rhymingrealtor says:

    Don’t forget to bring up LIBOR.


  171. BC Bob says:

    3b [174],

    Probably better chance of them understanding Mandarin.

  172. lisoosh says:

    Pat – Thanks. Those are good places to start. My husband works in Bridgewater so perhaps I should also look more northward (though I prefer Bucks), it is my friend whose husband is bound to Trenton (lobbyist).

    Ket. – good point. Looks like only place left is Oregon. ‘Till I retire in Scotland that is.

  173. kettle1 says:

    Faux news AKA

    The Ministry of Truth

    Despite housing, credit woes, GDP actually grew

    Shrugging off doom-and-gloom predictions, U.S. economy manages to expand 0.6 percent in the first quarter–quarter/

  174. Clotpoll says:

    BC (176)-

    No chance of them understanding anything.

  175. njpatient says:

    A rate cut just doesn’t go as far as it used to. Must be the inflation.

  176. Hehehe says:

    New government website for comparing fuel economy of cars:

  177. Hehehe says:

    “GDP actually grew” – yeah inventories grew, but consumer spending didn’t, so what do they do next quarter when all that crap sits on the shelves, no wait we send out refund checks and hope they buy the crap

  178. Painhrtz says:

    Looking forward to the mad maxian gas and water wars in the southwest. Welcome to barter town, I wonder how the real estate agents would spin that one. I really need to buy more ammo.

    It is also nice to see that I’m not the only paranoid freak who thinks the MSM is sounding more and more Orwellian.

  179. Sean says:

    Tommorow we have initial jobless claims, personal income/spending followed by construction spending and ISM manufacturing.

    I may want to stock up on bullets too since it seems the FED is down to the last clip.

  180. Wag says:

    it’s not Scotland, but interesting none the less:

  181. Teddy says:

    #183 – orwellian is right,and dont forget about food – WSJ headline this morning on the front page was “Grain Companies’ Profits Soar as Global Food Crisis Mounts”

  182. Rich In NNJ says:

    From MarketWatch:
    4:37Paulson continues to urge financial firms to raise capital
    4:36Paulson sees ‘more bumps in road’ for financial markets

  183. BC Bob says:

    Reduced in Weehawken, right next to the Lincoln Tunnel and NY bus stop?

  184. BC Bob says:

    “4:37Paulson continues to urge financial firms to raise capital”


    Why raise capital? The crisis is over. No?

  185. bts says:

    I know this has been discussed previously, but any thoughts/anecdotal information on bank’s willingness to deal on REO’s?

  186. Rich In NNJ says:


    I thought so!

  187. Theo says:

    For those interested in where asking prices are in Montclair in relation to the past few years, I had a realtor from one of the open houses I visited send me an email with a number of houses currently on the market…

    Here is the current asking and previous sale info on a few:

    12 Van Breeman, 3b, 2ba ranch
    Last sale: Oct 2005 $500k
    Current ask: $499k

    19 Carolin, 3b, 2b ba col
    Last sale: Aug 2006 $571k
    Current ask: $529k

    9 Windermere, 3b, 3ba says Custom.. look BiL
    Last Sale: July 2004 $650k
    Current ask: $549k

    82 Essex, 4b, 2ba col
    Last sale: Nov 2003 $440k
    Current ask: $599k

    1 Chester, 3b, 2ba col
    Last sale: Aug 2006 $530k
    Current ask: $569.9k


  188. BC Bob says:

    “We are closer to the end” than to the beginning of the crisis, Pandit, 51, said today at the first shareholder meeting since he succeeded Charles O. “Chuck” Prince in December.”

    Bloomberg- 4/22

    “Lehman CEO Fuld says worst of credit crisis behind Wall St.”

    Yahoo- Finance- 4/15

    “Lloyd Blankfein, Goldman Sachs’ chief executive, on Thursday said there was “light at the end of the tunnel” for the investors and financial firms hit by the credit crunch – the latest sign of Wall Street’s belief the current turmoil may be nearing its end.” 4/11

    “PURCHASE, N.Y. — Morgan Stanley Chief Executive John Mack said Tuesday that Wall Street is facing the most difficult conditions that he has seen in 40 years, but he feels the global credit crisis might be “in the final innings.” 4/8

    “U.S. investment bank Merrill Lynch does not plan to raise further capital as it has already raised more than it has lost, Chief Executive John Thain said on Tuesday.” 4/8

    From Rich [187],

    Rich In NNJ Says:
    April 30th, 2008 at 4:42 pm
    From MarketWatch:
    4:37Paulson continues to urge financial firms to raise capital
    4:36Paulson sees ‘more bumps in road’ for financial markets

  189. grim says:

    I suppose that it could have been worse.

    Prudential shows 92 percent drop in first-quarter profits

    Profits at Prudential Financial dropped 92 percent for the first quarter, a performance that executives blamed on market volatility.

    The Newark-based financial services firm said today it earned $77 million in the three months ended March 31, compared with $1.025 billion in the same period last year. The results included losses of $290 million related to asset-backed securities tied to subprime mortgages.

    Prudential also said it decided to exit its commercial mortgage securitization business, which recorded a $107 million loss for the quarter.

  190. grim says:

    I went down and bought the new iMac on Monday night and even the Apple store in short hills mall worked with me.


    Better prices than the online stores, Mac Mall, etc?

  191. bairen says:

    #193 BC Bob

    None of those clowns saw this bubble coming, but now we are supposed to believe them when they say it is going?

  192. bairen says:

    #194 Prudential keeps calling and emailing me to become a financial planner.

    I had to mark them as spam to stop their emails.

  193. New in NJ says:

    NY Times Op-Ed

    It is great to see that we finally have some national unity on energy policy. Unfortunately, the unifying idea is so ridiculous, so unworthy of the people aspiring to lead our nation, it takes your breath away. Hillary Clinton has decided to line up with John McCain in pushing to suspend the federal excise tax on gasoline, 18.4 cents a gallon, for this summer’s travel season. This is not an energy policy. This is money laundering: we borrow money from China and ship it to Saudi Arabia and take a little cut for ourselves as it goes through our gas tanks. What a way to build our country.

    When the summer is over, we will have increased our debt to China, increased our transfer of wealth to Saudi Arabia and increased our contribution to global warming for our kids to inherit…

  194. njpatient says:

    196 bairen

    It’s the Doppler Effect – bubbles are nearly invisible if traveling toward you but clearly visible if traveling away from you.

    Or something.

  195. bairen says:

    #200 njpatient

    Doppler effect, my new phrase of the week. So this bubble for the finance industry is like walking where a person has past gas. You don’t know until you’re in it but you can tell when you’ve cleared the area?

  196. lisoosh says:

    Wag – slightly out of my league, but not bad for newer construction.
    Nothing beats those old Bucks County stone farmhouses though.

  197. SG says:

    Bubble Banking
    30 Apr, 2008 07:09:45

    Federal Reserve under fire as commodity bubble wreaks chaos; WSJ says Bernanke addicted to printing (LBO) – The Federal Reserve money printing that has fired a commodity bubble causing malnutrition and food riots in poor countries is increasingly coming under fire, with mainstream media adding their voice to a growing flood of critics.

    The Journal also slammed the Federal Reserve’s practice of quoting a ‘core’ inflation index which strips out food and energy which are the very types of goods that has a deadly response to monetary policy action in the first place.

    “…the Fed and much of Wall Street convinced themselves that the only inflation measure that matters is “core inflation,” which excludes food and energy,” the Journal said.

    n criticizing ‘core inflation’ the Journal is joining other mainstream media.

    The Economist last year called the US core indicator “the cold and hungry index” and asked whether the typical American was “on a permanent fast, walks everywhere and survives without heating or air conditioning.”

    Core inflation has also come under fire from Bank of England governor Mervyn King who said it was “highly misleading”, because rising energy and food prices which affected aggregate demand, tended to depress the prices of all other goods.

    Many central banks in developing countries have also found comfort in ‘core’ inflation to escape public criticism for printing money and driving inflation up.

  198. Frank says:

    Sitting in traffic on the GSP, I ask what recession? High oil prices? Everyone has an SUV.

  199. SG says:

    News from UK

    A house of cards

    We mustn’t bail out the housing market. Give it time to self-correct, a process it has already begun.

    Prices have trebled since the 1990s and even a drop of 30% in house prices would only take values back to their 2004 levels. If you didn’t buy in the last couple of years and haven’t used your house as a cash machine, then you have nothing to worry about. If you didn’t lie about your income in order to get a 125% mortgage, you have nothing to worry about. And if you didn’t believe the rubbish spouted in the property pages of national newspapers, and didn’t fall for the property porn merchants on Location, Location, Location, and splash out on an “executive” new build apartment in the inner city regeneration area of your choice, hoping that some mug’s rental payments would fund your retirement, once again you have nothing to worry about.

    The Bank of England failed, unfortunately, to raise interest rates when house prices were rocketing ahead in 2006 and 2007, even though many commentators saw a huge bubble continuing to expand. Following the recent quarter point cut, they should certainly not intervene with further interest rate cuts now. The remit of the Bank of England monetary policy committee is to ensure inflationary stability, not to stop fools being separated from their money.

  200. SG says:

    Irrational Exuberance to Bust: Financial Bubbles Demand Regulation

    Because asset-bubble bursts affect the entire economy, there’s irresistible political pressure to socialize the losses when they become too threatening. This socialization of losses took place in the Asian and the dot-com crises. It’s again happening – both directly, with public money rescuing banks and, indirectly, when loose monetary policies lead to increased inflation, the cost of which will be borne by society as a whole. This does not imply that expansionary fiscal and monetary policies should be avoided to forestall an even more dramatic slowdown in the US and world economy. But socialization of large parts of the financial-sector losses may encourage the next asset price bubble.

    We must ponder the next potential asset bubble. The impressive growth of India and China has increased the demand for raw materials, food and energy in a lasting way – but the size and suddenness of recent increases in many commodity prices, including gold, point to a speculative component. I’d not be surprised that two or three years from now we realize that the liquidity and macro-boost generated to fight the sub-prime housing crisis ended up fuelling excesses in the commodity markets.

    If we want to reap the benefits of global opportunities in a steady fashion, rather than being subjected to recurring shocks from the financial sector, it may be time to attack the root causes of these shocks in terms of financial-sector regulation that focuses on the nature of the structural problems in the sector, rather than using blunt macroeconomic instruments. Such tools may work in the short term by bailing everybody out, but often plant the seeds of the next financial storm.

  201. lisoosh says:

    Housing Porn:

    Woodrow Wilsons old house in Princeton:

  202. SG says:

    How Smart Growth Exacerbated the International Financial Crisis

    In the ongoing debate over the causes and cures of the mortgage meltdown, one of the most important factors has been virtually absent: the role of excessive land use regulations in exacerbating the extent of losses.

    What Is Excessive Land Use Regulation?

    As we know from introductory courses in economics, scarcity raises prices. In a number of metropolitan markets across the country, excessive land use policies have been adopted, such as urban growth boundaries, huge areas recently declared off-limits to development, building moratoria, confiscatory and unprecedented impact fees, and excessively large minimum lot sizes.

    A few voices in the wilderness on both sides of the political spectrum have pointed to the role of excessive land use policies in driving up housing costs. For example:

    * Liberal economist Paul Krugman of The New York Times put most of his conservative colleagues to shame in noting that the house price bubble has been limited to metropolitan areas with strong land use regulation.
    * Conservative Thomas Sowell, no stranger to being a voice in the wilderness, has made similar points.

    * More recently, Theo Eicher of the University of Washington produced a working paper placing much of the blame for house price escalation on land use regulation in cities around the nation.

    But there are broader economic consequences that have expanded to the international market. From 2000 to 2007, the gross value of the U.S. housing stock rose $5.3 trillion relative to household incomes. It is estimated that $4.4 trillion of this increase occurred in the 20 most escalating markets, all of which are characterized by excessive land use planning. In each of four markets (Los Angeles, New York, San Francisco, Washington, and Miami), the aggregate escalation above incomes was a third of a trillion dollars or more.

    Any serious effort to prevent a repeat of such destructive price volatility will require removing these destructive land use regulations that have done so much to destroy housing affordability in many markets while adding inordinately to the financial distress that is being felt around the world. Economics-challenged state and local politicians must not be permitted to steer the international economy into an iceberg.

  203. njpatient says:

    201 bairen

    “like walking where a person has past gas. You don’t know until you’re in it”

    that’s when you know you’re near a bottom.


    someone’s gotta do grim’s cartoon.

    Hey grim – in the first frame of your cartoon, when the realtor is pointing out that the bottom is in sight, perhaps he might also note that the property has a waterfront view (location location location)!

  204. BC Bob says:

    “The Economist last year called the US core indicator “the cold and hungry index” and asked whether the typical American was “on a permanent fast, walks everywhere and survives without heating or air conditioning.”

    Yes, dead man walking.

  205. bairen says:

    Core inflation is bogus. It’s like slapping a value on a dot com based on the number of “eyeballs” per day. Pure nonsense.

    If someone starts spewing this BS at me I smile, put my hand over my wallet and start backing up towards the exit.

  206. njpatient says:

    So here are the NOLA observations:

    We had a great time on vacation in New Orleans. Global food prices may be up, but you can still get the best food in the world for dirt cheap down there (not to mention the best music for even cheaper – the locals were complaining about $40 tickets to spend the entire day seeing 50 great bands – spoiled buggers). Most importantly, the city seems to be just about completely recovered in any sense that can be apparent to visitors. The Quarter, Uptown, Garden District and Arts Districts seem as they were before the storm, and even areas in Metairie that sustained more damage are almost completely revitalized.
    New construction in New Orleans is a great deal more attractive than what we see in Jersey. I’ve sent one pic to grim to post, but the main difference is that each new house has it’s very own style and character – you can’t drive through town and easily identify what is and isn’t new construction (let alone by builder as you can here). New construction also seems to keep with the character of the neighborhood (as applicable there may be balconies, genuine stone or brick walls, wrought iron fences, gas lamps, columns, etc., and no two are the same). No faux-brick fronts with vinyl siding, little oval-shaped windows and strips of faux stone four feet high along the bottom of one side of the house.
    There are, however, plenty of sellers whose pricing is just as out of touch with reality as anywhere else – they may be fooled by the fact that the economy in New Orleans is growing so quickly (even if the demand for housing isn’t).
    A couple of fun vignettes (lagnappe, if you will):
    – We saw a sign that said “Free Gas With Your Order of Red Beans”
    – When we told one shop-owner where we were from, he said “New Jersey?!? I hear you’ve got the highest property taxes in the country!”
    – We ran into a friend of a friend who disclosed that she was from Bergen County. When asked where in BC, she looked shifty and said: “All over.”

  207. BC Bob says:

    “High oil prices? Everyone has an SUV.”


    Every addict also has a drug dealer. Aren’t you answering your own question?

  208. bairen says:

    #206 njpatient


    I wish I could draw.

  209. njpatient says:

    211 bairen

    “you’ll find that, after awhile, you get so used to the flushing noise that you don’t even hear it.”

  210. grim says:


    Just took a quick look, not in a place I can post, that new construction is beautiful.

  211. Cindy says:

    (131) lisoosh

    Lisoosh, I lived in Oregon for 21 years. It is green… lush… and a beautiful place to visit. It is green/lush BECAUSE IT RAINS ALL THE FRIGGIN TIME! Even the cows are pretty and clean. I was once rained out of a Fourth of July beer baseball game. So it rains..October through June.

    “I don’t want to become someone else’s bag holder.” Well,…..

    I left because school teachers were asked to take pay cuts – lots of financial issues. No sales tax so if you OWN a home and WORK – you pay all of the taxes.

    Lastly, my youngest recently moved from Eugene to Portland (which she loves by the way.) Eugene really is a hippy-dippy college town. U of O – maybe 20,000?
    Very liberal (politically) but more cloth baby diaper/ granola/mother earth/ kinda liberal…lots of tatoos and such and its all about your bike in that town.

    IMO Portland has many more financial opportunities and I’m sure has an established Jewish community. At least near Portland, you have outlying communities off of I5 where you can live and a more stable economy. There is no money in Eugene – just college kids. Very little new construction- high priced RE.

  212. njpatient says:

    213 grim

    no worries:

    “that new construction is beautiful.”

    I really wish I had 15 photos to show you – that one is in the middle of the pack. I grabbed it because the sign in the foreground that you can’t read because of the light has the builder’s name, and I’m sure that if I posted a bunch of photos here, folks might suspect that they weren’t really new construction and I was putting them on; it’s that nice.

  213. njpatient says:

    “IT RAINS ALL THE FRIGGIN TIME! Even the cows are pretty and clean.”

    We’re suede!!!!

  214. NJGator says:

    From today’s testimony by Administrative Director of the Courts to the Senate Budget and Appropriations Committee…

    Economic indicators tell us that by the end of this court year, case filings will reach historic highs. For example, foreclosure filings in New Jersey for the first quarter of 2008 exceeded 4,000 per month, a staggering 44 percent increase over the same period last year. This year we are on track to receive an anticipated 49,000 foreclosure filings. This is double the number we received in 2006, just two years ago. And our best estimate is that we may double this number yet again next year.
    Increased foreclosure filings are a harbinger of increases elsewhere. Our special civil part filings are about to hit record highs. Families in financial trouble, when forced to decide between paying a credit card bill or the mortgage, pay the mortgage. Left unpaid, their credit card debts will reach our special civil part courts, where filings are for amounts under $15,000. We are analyzing the numbers on a monthly basis and have grave concerns. We project receiving more than 621,000 Special Civil Part cases this year, 100,000 more than last year.
    We know from experience that we must be watchful of similar growth in other case types as well. Another by-product of hard economic times is displacement in people’s lives. Financial struggles tear families apart, possibly resulting in divorce, domestic violence, abuse or neglect of children or missed support payments. We may see the effects of increased financial strain in the criminal courts as well. Our court system’s challenge is great: to adequately manage and resolve cases that we project will increase overall by almost 9 percent by the end of June while at the same time reducing staff by 300 to meet our budget reduction of $27 million.

  215. grim says:

    Just what we need, a lawyer bubble.

    Good grief

  216. Sean says:

    re: calling bottom or “We are closer to the end”

    Thought I would share an interview of Warren Buffett from Fortune magazine this month.

    what caught my eye was this question and Warren’s answer.

    Question to Buffett

    Do you find it striking that banks keep looking into their investments and not knowing what they have?

    Answer from Buffett

    I read a few prospectuses for residential-mortgage-backed securities – mortgages, thousands of mortgages backing them, and then those all tranched into maybe 30 slices. You create a CDO by taking one of the lower tranches of that one and 50 others like it. Now if you’re going to understand that CDO, you’ve got 50-times-300 pages to read, it’s 15,000. If you take one of the lower tranches of the CDO and take 50 of those and create a CDO squared, you’re now up to 750,000 pages to read to understand one security. I mean, it can’t be done. When you start buying tranches of other instruments, nobody knows what the hell they’re doing. It’s ridiculous. And of course, you took a lower tranche of a mortgage-backed security and did 100 of those and thought you were diversifying risk. Hell, they’re all subject to the same thing. I mean, it may be a little different whether they’re in California or Nebraska, but the idea that this is uncorrelated risk and therefore you can take the CDO and call the top 50% of it super-senior – it isn’t super-senior or anything. It’s a bunch of juniors all put together. And the juniors all correlate.

  217. Steve says:

    Lots of cuts in ML’s Hopewell campus today, this time in the Consults/Managed acct area. Heard multiple floors seen with folks departing w/ their packed boxes.

    Also, ML offering severance and early retirements trying to get some to exit. Those accepting severance can’t work for a competitor until it runs out (doubt this will be easily enforceable).

    Though, I doubt it’s going to be very easy for any of those folks to get work in the near term…

  218. Frank says:

    Citi is getting ready for another round of cuts at their investment bank.

  219. ADA says:

    Hey everyone,
    question for the group.

    I currently have a 30 year fixed/6.375 with an approx balance of 500K at countrywide. I’ve held the mtg for about 1.5 years and had put 25% down. Although I am not having a problem with the monthly PITI, today I called them to see if I qualified for a better rate on a refinance after the new conforming limits were passed. The guy tried to talk me into refinancing into an interest only loan with a fixed term up front for 5 or 7 years. He said that almost my entire current payment is interest anyway I might as well be getting the much lower interest rate offered by the interest only loan since I intend on leaving the house after 5-7 years.

    Is he right does this make sense for me?

    thanks in advance for any help/insights,

  220. lisoosh says:

    Cindy – Thank you so much for the detailed answer.

    Luckily, I grew up in Scotland where it is lush and green – because it rains all the bleeping time too, and never predictably. So I’m probably one of the few people it actually doesn’t bother that much. I’ll take rain over biting cold and snow or humidity any day.

    I see your point about Eugene. I liked its size, am fairly liberal and a bit crunchy granola myself, but on the other hand, I have come across a couple of people from there who are unbearably hippyish and self absorbed to the point where it just isn’t fun anymore. Like their whole Slug Queen thing for instance.

    Portland always appealed but I had thought it was very inflated and bubbly. Of course actual access to a healthy job market is a big plus. I’ll revisit the issue. I really need to take a trip out there anyway to get a real feel for things. I’ve moved further on spec before but now that I have kids I’m not jumping into anything without really looking into everything.

  221. TJ says:


    If that mortgage offers a lower rate than a 30-year fixed conventional and (and this is a big and) you are allowed to pay down principal, I would take it. However, usually, since I/O’s are considered riskier than conventionals they have a higher iRate and closing costs.

    In all likelihood it has an higher iRate and closing costs and they want to make more money off of you since you probably are a well qualified applicant.

  222. bairen says:

    #223 lishoos

    When you go to Portland check out the suburbs like Beaverton and Hillsborough. Be careful in downtown Portland after 5 PM. It’s like being in DC after 5 PM. all the business people disappear and tons of teens and early 20’s wandering around in groups. Everyone in each group wearing the same colored shirt or hat.

  223. mr potter says:


    You will pay/reduce your principal by about 50k in the first 7 years with the current loan. In an interest only scenario you will reduce principle by zero. My view is that interest only loans are a suckers bet. Your rate is not bad and to re-fi there is always closing costs. My advice would be to stay put in the loan you have. Good luck

  224. kettle1 says:

    nj payient,

    can you put them on picasa (google photo software) and share them online. I would be very interested in seeing what you have.

  225. PGC says:

    “, and at least three pizza shops in Hoboken said they now charge $3 for a plain slice.”

    Does this mean Bennys will shrink the size of their slice?

  226. ADA says:

    TJ, Mr. P,

    Thanks, appreciate it.

  227. lisoosh says:

    bairen – hippy gangs?

  228. Steve says:

    A note about the northwest- born and raised in Seattle so I know it well. The northeast and northwest are such completely different worlds, I think it can be very difficult to adjust unless you really understand the pros/cons of each lifestyle.

    Generally, the weather just sucks during the winter and 1st part of summer. Rain rain, damp and gray sometimes for weeks on end. Growing up there, it never bothered me much until I lived in the midwest and NYC where you really do have sunny skies so many days of the year. Now I go home and go a bit crazy…

    The way we always got around this, was to go skiing – rain the lowlands usually means good snow up high.

    Job market out there is not well diversified, nothing close to the amount of companies or general economic activity vs. northeast. It’s important to note, because your job mobility will be be severely reduced, unless you happen to be in software or a few key industries. You should be comfortable with the idea that your job and company will be much more permanent because there aren’t so many choices, and getting big increases in comp is tougher. As a result, most people make a fraction of the money they do out here.

    Mass transit pretty much nonexistent, cars are used for everything, including going to work. In Seattle for instance, traffic jams and gridlock are a real headache, and no meaningful investment in infrastructure to solve it on the horizon.

    Along with lower wages, housing also was historically very cheap compared to NYC/NJ, but it’s now gone up much higher than justified by incomes, so buying in a metro area isn’t the deal it used to be. I remember when you could by a house in the city, on a major lake (e.g. waterskiing every day) for like $300k in mid-nineties (now many times that). Overall cost of living though is still much lower than here, however.

    So, those are the major downsides. Upsides? People are very friendly, pleasant, life is much more balanced and incredibly less intense and less stressful than NYC. Life moves slower, which can drive type A New Yorkers crazy.

    For outdoor activities, there’s simply nowhere like it. Incredible mountain ranges, lakes, saltwater, forests and natural beauty which could take you a lifetime to explore – right outside your doorstep, accessible year round. Mountain biking, skiing, mountain climbing, camping, hiking, fishing, boating, anything you want in that arena. World class.

    Public education generally quite good, including some major universities (e.g. U of Washington), and also quite cheap. Not so much emphasis on private schools or colleges, which is good for the pocketbook, can put kids at a bit of a disadvantage competing if they come out east but it can be overcome. My UW tuition (top 20, state school) was about $1100 freshman year in mid nineties. That’s not a typo.

    Taxes are generally much lower all the way around. Washington state I don’t believe has a state income tax, even in the best areas property taxes are very low compared to the People’s Republic of NJ.

    Most from the northwest never leave, they love it and wouldn’t trade the life for anything in the world. A little insular, quite liberal and a bit naive perhaps. More likely to be passive/agressive culture than in-your-face new york style, each way of interacting has its pros and cons.

    If you have some $$ in the bank, a good job lined up and want a 180 change from NYC lifestyle, it’s something to consider.

    Just my IMHO, have family in Portland but never thought much of it myself. A 3rd tier city in my opinion; the state was always considered to be backwoods (it’s all relative of course, ha). Compared to NYC, urban life in SF is the closest, but nothing comes within orders of magnitude.

    Just my two cents..

  229. Pat says:

    Rebate rebate, who’s got the rebate?

    Shoprite has a deal. But if I had one of those rebate checks in hand, I’d try to dicker like Mike.

    Shoprite is offering $330 cards for every $300 in “stimulus” checks you cash there.

    I’d go to Wegmans with the deal and ask for $350.

  230. njpatient says:

    kettle – I’ll try it in the morning when I’m wide awake.

  231. Pat says:

    kettle, cut that cr@p out with the 5* beach pics unless you can find me a nice cruise for two for under two grand from NY or Phil.

  232. PGC says:

    Little Kims Repo.

    I smell something amiss here. Didn’t she just trade upn Alpine in the last year or so. I would assume she would have had to put down some serious cash to underwrite the note.

    On the other hand, is this a fallout from the credit crunch

  233. Shore Guy says:

    #233 “I’d go to Wegmans with the deal and ask for $350.”

    I’d take $250 at Wegmans and consider it a deal, were I to receive one, anyway.

  234. RayC says:

    Where is there a Wegman’s? Haven’t been since my sister left Syracuse.

  235. afe says:


    donation should post soon


  236. grim says:


    Thank you!

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