From the Wall Street Journal:
Lessons From the Housing Bubble
By DAVID WESSEL
May 29, 2008
Before we replace angst about housing, mortgages and credit markets with anxiety about rising oil prices, consider what we’ve learned in the past several months. We had a housing bubble; that’s now obvious. But how did it happen? Why was its bursting so painful? Without answers, we can’t hope to reduce chances of a repeat.
Boil it down to the three R’s: rocket scientists, regulators, and ratings agencies.
The rocket scientists are the wizards of Wall Street who invented securities that supposedly dispersed risk widely but actually created much more leverage than proved wise.
There is a good case that the savings-and-loan mess of the 1980s was made in Washington, the inevitable result of government deposit insurance that led to tails-you-lose, heads-I-win banking. The current mess was made on Wall Street.
A bubble so large also required aggressive mortgage originators, imprudent home buyers and myopic investors. But it wouldn’t have been as bad if not for the paper factories that sliced up individual subprime mortgages and assembled the pieces into securities, each with its own acronym, that were deemed safer than the underlying loans. They behaved as if they were taking a little poison and diluting it in a big reservoir; instead, they poisoned the entire water supply.
…
“The idea of risk dispersion is nice in theory, but in practice it depends on who it gets dispersed to,” says Peter Fisher, a former Federal Reserve Bank of New York official now at money manager BlackRock Inc. “It turned out we weren’t dispersing it to strong hands who could hold it through the volatility. Rather, we were dispersing it to weak hands who couldn’t hold it, and ended up adding to the volatility.”The cost of delinquency, default and falling house prices often was passed to entities (some linked to brand-name banks) that lacked the financial strength to weather a storm. As the entities couldn’t bear the burden for long, they had to sell mortgage-linked securities into a hostile, illiquid market, pushing down already depressed prices.
In a modern capitalist system, regulators provide guardrails to keep markets from driving the economy off a cliff. The regulators failed. Whether regulators should or could have restrained innovation on Wall Street or prohibited business deals between consenting, sophisticated adults is a tough question.
But regulators failed to protect unsophisticated consumers from mortgage loans that they simply couldn’t afford or didn’t understand; they’re now fixing that. And regulators misunderstood the risks that banks were taking and failed to stop lenders from lowering standards too far in their frenzy to attract business; fixing that will be tougher.
Among their many failings, the regulators allowed lenders to make a fundamental mistake: To lend not against the borrower’s cash flow and income, but instead to lend against the seemingly inexorable increase in the value of the collateral. Mortgages were made to people who couldn’t afford the payments because the lender (or investor) figured that if the borrower defaulted, the house would always be worth more than the loan.
“It is the hallmark of a credit bubble when lenders think that because collateral is going up in price they can ignore the borrower’s ability to pay,” says BlackRock’s Mr. Fisher. “Collateral should only be a backstop.” When lenders forget that, regulators must step in. “Lenders need someone to prevent them from competing their way to the bottom,” he says. Let’s put those words on a laminated card and hand it to every banking supervisor.
…
The flaws of rating agencies are a mélange of conflicts of interest, misleading grading systems that classified complex securities as if they were much like simple corporate bonds and a backward-looking approach that proved particularly useless. They were the enablers. They are atoning and changing their ways, as they should. Their business model will change; government oversight will be strengthened.But investors who relied on the rating agencies — particularly supposedly sophisticated pension funds and other institutions — are at fault, too. Rating firms became a crutch for investors who simply didn’t want to spend the time and money required to be prudent investors at a time when low interest rates had everyone reaching for higher returns without contemplating the higher risks.
A little “back to basics” in banking and investing would go a substantial way toward avoiding a repeat of the Panic of ’08.
Reported this morn CNBC Europe , home prices
in Britain down 2.5% in May 4x what was expected. Also something about this being largest 1 month decline, in what period I didn’t catch.
Next on the hit parade Europe?
From the AFP:
House prices fall in May: survey
House prices fell by 2.5 percent in May from April and also showed the biggest annual decline for 17 years owing to the credit crunch, the Nationwide bank said on Thursday.
“The pace of house price falls accelerated in May as more weak economic news added to the gathering momentum of negative sentiment about the housing market,” said Nationwide’s chief economist Fionnuala Earley.
“Problems in credit markets have clearly been the trigger for changing fortunes in the housing market,” she added.
House prices dropped 4.4 percent in May from a year earlier, according to Nationwide. This represented the biggest annual fall since December 1992, it added.
From BusinessWeek:
Bad Omens for Banks?
Nobody was expecting an easy year for U.S. banks, but many observers thought the bulk of the industry’s credit troubles would come in the first quarter. Now, it seems the rest of the year may be even worse. Case in point: A May 28 announcement from KeyCorp (KEY). Mounting loan losses at the regional bank company suggest the banking industry’s troubles with bad loans are just beginning.
Cleveland-based KeyCorp, which holds $97 billion in assets, says the year’s net loan charge-offs—a measure of how much bad debt the bank may have to write off—could almost double previous predictions for 2008. The bank expected charge-offs of 0.65% to 0.9% of total loans just three weeks ago, but now says they could be in the range of 1% to 1.3%.
The main culprit is the bank’s portfolio of loans to residential homebuilders, KeyCorp said in a Securities & Exchange Commission filing. Losses have also increased on education loans and home-improvement loans.
…
“Near-term credit trends appear to be getting worse,” said R.W. Baird analyst David George. Those hoping for a recovery in the second half of the year will be disappointed, he wrote in a May 28 note, “as loss rates appear to be rising.”
From CNBC:
Inflation-Wary Fed Looks Ahead to Rate Hikes
Two Federal Reserve policy-makers warned on Wednesday that interest rate increases might be needed before too long to curb inflation, even as the United States struggles with a weak economy.
The remarks solidified expectations that the Federal Open Market Committee has ended an aggressive rate-cutting campaign and could start to reverse its policy course late this year.
Dallas Fed President Richard Fisher and Minneapolis Fed President Gary Stern, both voting members of the FOMC in 2008, said they are keeping a close eye on the level of inflation expectations being dialed into financial markets.
“If inflationary developments and, more important, inflation expectations, continue to worsen, I would expect a change of course in monetary policy to occur sooner rather than later, Fisher said in San Francisco.
Rate increases could be made “even in the face of an anemic economic scenario,” Fisher told the Commonwealth Club of California.
Earlier, Stern vowed that the Fed would act in an “appropriate and timely” way. “The key to maintaining low inflation and inflation expectations is likely to be the timeliness and magnitude of decisions we make to reverse course” on interest rates, Stern told a local business group in Altoona, Wisconsin.
From the Record:
Changing of the guard occurring among homes
Massive homes now tower above decades-old ranches — some just five feet from the property line. Water reaches basements that used to stay dry in all but the largest downpours.
And residents and officials are left to wonder how a River Edge neighborhood changed so quickly and with so little oversight.
“They’re changing the character of the town,” said Gregg CQCariddi, a volunteer firefighter. “I’m just waiting for the wrought-iron gates.”
Tear downs are common in North Jersey. From Closter to Clifton, small homes are knocked down and rebuilt into what have become known as McMansions — large homes on small lots.
In southern River Edge, builders pursued one-story homes even before they went on the market, looking for a quick quarter-million-dollar turnaround.
For the last two years, ranch-style homes — single level houses that are long and low to the ground — attracted heavy interest. Turnover sometimes took only a few months, sale to sale. Out of 23 teardowns in the past two years, the median original sale price was $425,000. Sixteen of those resold for a median price of $793,500, property records show.
The sales reflect changing demographics, as empty nesters moved out and young families came in. Deeds show builders often bought from widows or executors of estates.
Grim 2 Thanks, a lot going on in the waiting house this morn no time to research.
Back to getting the boys out the door for school, ham & eggs this morn. Waffles for the little sis. School bus starts picking up 630,then 700 then 830, I would have never made the 630 in my day. Sure keeps us busy.
Citi will collapse.
SAS
#5: Great article, these builders claim they are making River Edge nicer, when in reality they are building cheaply and poorly constructed houses. Anyone who bought these River Edge McMansions (if they dont already have problems) will have major problems in a few years…
From CNBC:
Credit And Borrowers: Saving Your Status is Not Always Fair
I was moderating a panel of two governors and an economist today on the foreclosure crisis. It was much of the usual stuff until Pennsylvania Gov. Ed Rendell made a bold proposal.
He said that in addition to the legislation making its way through Congress to save troubled borrowers, there should be additional provisions that protect borrowers from having their credit rating destroyed when they go through foreclosure.
I understand where he’s coming from. “This is not for people who took risks,” he says. “This is for people who were legitimately duped by unscrupulous people.”
…
It’s just not practical. For many many months I’ve heard many many policy-makers, lawmakers, and decision-makers argue for the good of those poor borrowers who were tricked into faulty mortgage products. They paint a picture of not ignorant, but perhaps uneducated folk who truly believed that they were buying into a sound financial scenario.
But the fact of the matter is that a lot of borrowers, and not just the speculators, went in with their eyes open. They were told that their loans would adjust and that they could refinance based upon the current rate of appreciation. They bought into that appreciation; they gambled on it.
Some anecdotal info from the UK: Stu and I spent part of our trip visiting friends who lived in a 5 year old development in Ashford (Kent). think British McMansions (but tasteful) about a 1 hr train ride on Brit Rail outside of London. There were plenty of real estate signs in the community, but almost all of them were ‘To Let’, because the homes are now worth less than what the owners paid.
Incidentally, a newish home that far outside of London with almost no property was fetching over 500,000 pounds.
3b, I cant wait for you to comment on that article!
From the WSJ:
Study Casts Doubt on Key Rate
WSJ Analysis Suggests Banks May Have
Reported Flawed Interest Data for Libor
By CARRICK MOLLENKAMP and MARK WHITEHOUSE
May 29, 2008; Page A1
LONDON — Major banks are contributing to the erratic behavior of a crucial global lending benchmark, a Wall Street Journal analysis shows.
The Journal analysis indicates that Citigroup Inc., WestLB, HBOS PLC, J.P. Morgan Chase & Co. and UBS AG are among the banks that have been reporting significantly lower borrowing costs for the London interbank offered rate, or Libor, than what another market measure suggests they should be. Those five banks are members of a 16-bank panel that reports rates used to calculate Libor in dollars.
…
Faced with suspicions by some bankers that their rivals have been low-balling their borrowing rates to avoid looking desperate for cash, the British Bankers’ Association, which oversees Libor, is expected to report Friday on possible adjustments to the system. That report isn’t expected to recommend any major changes, according to people familiar with the association’s deliberations.
From HousingWire:
S&P Lowers the Boom on 1,326 Alt-A RMBS Classes
Bring on the Alt-A downgrades: Standard & Poor’s Rating Services said Wednesday evening that it had slashed the ratings of 1,326 Alt-A residential mortgage-backed securities, after recent data is proving performance of Alt-A loans originated in 2006 and 2007 to be particularly problematic. The downgrades affect an $33.95 billion in issuance value and affect Alt-A loan pools securitized in the first half of 2007 — roughly 14 percent of S&P’s entire Alt-A universe in that timeframe.
Perhaps more telling were an additional 567 other Alt-A classes put on negative credit watch by the ratings agency.
A review of affected securities by Housing Wire found that all of the classes put on watch for a pending downgrade are currently rated AAA, suggesting that S&P’s confidence in thin overcollateralization typical of most Alt-A deals is quickly waning. The total dollar of potential downgrades to the AAA classes in question would dwarf Wednesday’s downgrades, which affected only mezzanine and equity tranches.
Driving the downgrades are increasingly poor performance in Alt-A collateral; Housing Wire covered some of the key metrics in recent vintages in an earlier report, which found that 2007 vintage Alt-A loans saw severe delinquencies jump nearly 30 percent between March and April alone.
From Hoboken Now:
England: Tax bills could go up 50 percent in fourth quarter
During the public comment section of tonight’s City Council meeting, resident Rachael Goldberg cut to the chase: “What do you think our fourth quarter tax bills will be?”
Business administrator Richard England said that if council raises to fill a $9 million gap, the fourth quarter tax bill would be raised by about 50 percent. A $3,200 tax bill in the third quarter, for example, would likely go up to $4,800. This estimate was for the entire bill not just the municipal portion.
“Guys I’m really upset about this,” she said to the council after hearing the news. “At the end of the day, who are we holding accountable?”
“I honestly don’t care who’s running for what office, but at the end of the day, if my taxes are going up higher then the value of my house I can’t afford to stay here,” she said, adding after the meeting that tonight’s meeting illustrated mismanagement and a lack of accountability.
Now we’re getting somewhere.
Almost time to pull over and have a Stewart’s.
Legal weigh in?
From Calculated Risk:
BK Judge Rules Stated Income HELOC Debt Dischargeable
Am I understanding this correctly, $4800 a quarter?? That is $19,200 a year to live in Hoboken? ugh.
#17tbw,
Now the residents will have another reason besides alcohol to throw up at 2 in the morning.
From Bloomberg:
Bair Urges More Investment-Bank Oversight in Return for Fed Aid
Federal Deposit Insurance Corp. Chairman Sheila Bair called for greater oversight of investment banks, including a formula for closing them in case of insolvency, in return for access to Federal Reserve loans.
“Congress should consider whether they need to set up a system whereby there is an orderly process to close a systemically significant investment bank,” Bair said in an interview yesterday in Washington.
Her remarks are the most explicit recommendation by a U.S. regulator on how to limit the potential cost to the taxpayer of the Fed’s backstop to securities firms. While central bank loans helped stabilize the financial system after the near-bankruptcy of Bear Stearns Cos., the Fed hasn’t said how it will wind them down or what rules would be required to continue the lending.
…
Now, regulators are turning to the supervision of investment banks after the Fed’s rescue of Bear Stearns and lending to the firms spurred criticism that the aid may encourage brokerages to take on more risk.
#18: LOL
Re hoboken taxes,
I am not sure if it is just for the one quarter or for each subsequent quarter. The Mayor Quimby wannabe we have running this town needs a ride on the Christopher Christie express. There’s no telling where all the money’s been going. I am sure the mafia’s been getting their cut.
grim (16)-
That’s gonna leave a mark.
Anybody else notice a marked decrease in the number of credit card applications they’ve been getting in the mail lately. I used to get 2-3 a day. Now I am lucky to get 1 a week.
#10 NJGator
The UK came up with a great phrase during their last big bust in the early 90’s. “Negative Equity”.
What is surprising is that 15 years is a short time for people to have forgotten that housing bust and the lessons that were learnt.
I had a friend back then who worked in the foreclosure department of a bank. She compared her job to that of an undertaker. Not a pleasant profession from the outside, but staffed by professionals who loved their job. She used to joke that she was like the Grim Reaper (no offense) she would cause misery and pain wherever she went.
In the UK most of the mortgages are either endowment (you pay into a life insurance policy that should be worth enough at the end of the term to pay for the house) or adjustable rate. It was only when I came over here I found out there was such a thing as a fixed rate mortgage. The 90’s bust was caused by a period of low interest rates followed by a jump up to double digits. The increase in payments triggered the crash. From that point the UK has tried to keep a fairly tight control on interest rates as they know how much it hurts most of the mortgage market. The UK will try to avoid dropping rates to support the dollar, even though it is hurting their own exports.
#21 HEHEHE
Maybe they need the tax money to pay the Hooters bill. The lawsuits will cost. I hope they tip well.
http://wcbstv.com/topstories/hoboken.swat.team.2.666259.html
Yeah, the police chief is supposed to have something like a $150K a year pension. Only in Hoboken!
From Bloomberg:
U.S. Initial Jobless Claims Rose Last Week to 372,000
The number of Americans filing first- time claims for unemployment benefits increased last week, a sign the labor market is deteriorating as the economy slows.
Initial jobless claims rose 4,000 to 372,000 in the week ended May 24, from a revised 368,000 the prior week, the Labor Department said today in Washington. The total number of people collecting benefits swelled to 3.104 million in the week ended May 17, the highest level since February 2004.
U.S. companies are responding to the current economic downturn by reining in hiring rather than making workforce cuts as steep as they have in past recessions. In the 2001 recession, initial claims averaged 415,600 a week.
“The labor market has loosened, but on an historic basis it’s still relatively tight,” said Michael Englund, chief economist at Action Economics LLC in Boulder, Colorado. “Essentially the projections of weakness people have may have overdone the path we’re going to see in 2008.”
A separate government report showed the U.S. economy grew more than previously estimated in the first quarter as the trade deficit shrank to a five-year low. The 0.9 percent gain in gross domestic product from January through March compares with the government’s advance estimate of 0.6 percent issued in April, according to revised figures from the Commerce Department today in Washington.
But the good news with inflation that 150K a year pension will be worth nothing in ten years.
From MarketWatch:
First-quarter GDP revised up to 0.9% as expected
The U.S. economy grew at a sluggish pace in the first quarter of the year, held back by the biggest slump in housing in 26 years and the first decline in final domestic sales in 17 years, the Commerce Department reported Thursday.
The nation’s real gross domestic product increased at a 0.9% annual rate in the first three months of the year, slightly faster than the 0.6% rate originally estimated a month ago. The revision matched expectations of economists surveyed by MarketWatch.
GDP increased 0.6% in the fourth quarter. The economy has grown 2.5% in the past year.
The revision to GDP showed a better mix of growth. Compared with the first estimate, imports were lower, inventories were lower and business investment in structures was stronger. Personal incomes were also growing significantly faster than first believed, which could keep the economy out of a technical recession.
Still, the growth in the economy was due to higher levels of exports, war spending and a small change in inventories, not to strong domestic consumption and investment. Final domestic sales fell 0.1%, the first decline in domestic demand since the recession of 1991.
#8tbw: They should have mentioned all teh Mcmansions that are sitting and rotting in town, as nobody is buying them.
And yes many are poorly constructed, and just just plain ugly.
people can say what they want about those old ranches down there, but they have lasted 50+ years. I do not think the same can be said for those McMansiions.
ANd soem of those rancehs have been nicely restored/updated. and look much better than the Mcmansions.
#9 grim: Sickening. So absolutley no consequences at all, none. What a joke.
When you read the details of that HELOC case in California, it should send shivers up and down your spine.
The borrowers lied about their income (on several different apps) and then lied about the fact that they “signed but didn’t understand” the documents. The $50K cash they took out in April was all but gone in October….so let’s re-fi again. More lies. Their stated income on the last app was $190K, not the $65K they were truly making. How do you hose away $50K in 6 months?? If you built a fire you couldn’t burn it that fast!
The Mortgage Broker had to have some idea that an auto parts wholesaler and a home-base distributor of free periodicals could never be pulling down 200 large…yet he pushed the paper thru.
The appraised value of the house kept hitting the number all the way up to $856K. When the foreclosed property finally sold, it was for $450K. No wonder California is in trouble.
Yet the judge ruled that “the Debtors cannot be blamed for the Bank’s loss, and the Bank’s claim should be discharged.”
Incredible!
Just an FYI – I opened the latest group of listings last night and asking prices still look close to peak to me. $649,000 for a bland, dated 3/2 split in a Bergen wannabee town. Just saying.
Gary,
Let me list your place.
We’ll stage the photos to make it look like a wreck, then we’ll put a $2m price tag on. I’ll issue a flurry of press releases about a guy that refuses to lower his price, instead, won’t accept under $2m for his property. I guarantee the Times and Jersey rags will pick up on the story. You’ll be famous!
Gary,
Interesting anecdote.
Friend of mine sold his place on Garrabrant for $439k at the peak of the bubble, FSBO to boot.
He knew the guy couldn’t afford it, wasn’t his problem.
Foreclosed, was listed a few days back, REO, at $395k.
gary,
if you had to guess, out of curiosity where do you think the bergen 3/2 in a wannabee town will end up when all is said and done
njre 1050
housing panic 1020
Maybe this can ease the bitterness some sellers are feeling:
http://www.nytimes.com/2008/05/28/dining/28flavor.html?em&ex=1212206400&en=aeb427d606d64588&ei=5087
http://videogames.yahoo.com/feature/19-year-old-gamer-becomes-mayor-of-oklahoma-town/1215787
19 year-old gamer becomes mayor of Oklahoma town
>>
I hope this guy doesn’t get run over by a Warthog.
Gamer? Is than an occupation now?
re: (40)
Shore Guy Cyberathletes are the gamers who make money playing video games, and just like sports professionals they have leagues and logos.
This is one of the logos.
http://upload.wikimedia.org/wikipedia/en/f/fc/Finals_wt.gif
God help us.
My favorite 3/4 built McMansion is in Freeport Long Island, during the last downturn (1990!!!!!) the Tony Roma’s Rib place (remember them) went bankrupt and sat empty along with its parking lot on the other side of Atlantic Avenue for 15 years. Some bozo bought the 100 x 100 parking lot opposite Tona Roma in 2006 and in late 2006 started building a spec mcmansion. Well with it 80% done by last summer 2007 all building stopped, he got the roof, windows and doors on but no siding or appliances or landscaping. The stupid Tony Roma across the street with its hanging low Christmas 1990 decorations hanging on it is still their all boarded up. Starbucks put in a bid to lease it last summer but since pulled out. I guess old Tony Roma will have to wait till sometime in the next decade to regain its former 1980’s glory as a rib joint. For all of you folks who know Freeport I am amazed that a rib joint could go out of business their.
“But how did it happen? Why was its bursting so painful? Without answers, we can’t hope to reduce chances of a repeat.
Boil it down to the three R’s: rocket scientists, regulators, and ratings agencies.”
Uh, whay about the people who actually borrowed the money? They have no responsibility?
If so, can we please create of list of these incompetants so no one ever has to do business with them again?
grim [34],
I’m in. And after a few weeks, we’ll drop it 50% so the idi*ts think they’re getting a bargain.
homebuyer [36],
The mor*n owner of the bergen 3/2 in a wannabee town would rather get an ice pick shoved in their eye than lower the price on their POS hole.
#32 – Well, the essence of the court’s ruling is interesting. To wit; if a bank allows a loan applicant to state their income they can’t balk if the statement has no connection with reality.
While the borrowers are, indeed, emblematic of the problems with this boom-bust cycle they aren’t getting away free-and-clear; they’re in bankruptcy & they’ve lost their house. They’re just not responsible for the remaining balance on their SI loan.
It would be more emotionally satisfying to see them beaten with road-kill skunks, but I’m happy that the bank is getting hammered.
Oh, here are some great conditions under which to purchase a home:
“The properties are situated on leased land….It’s my understanding that the lease agreement for the land is good as long as the owner is alive. She is however, 90 years old.”
I guess after that it is time to pack up and move.
#9
“Pennsylvania Gov. Ed Rendell made a bold proposal.
He said that in addition to the legislation making its way through Congress to save troubled borrowers, there should be additional provisions that protect borrowers from having their credit rating destroyed when they go through foreclosure.”
unbelievable.
re: (16) Grim, I am no lawyer but I will weigh in anyway.
In City National Bank v. Hill how they heck did they even qualify for Chapter 7 bankrupcy with the husband making 65k a year?
Back in 2005 Congress and President Bush signed a new Bankrupcy law with a means test that was supposed to limit the number of people who could qualify for chapter 7.
If looks like the courts are going to be really busy erasing debt instead of forcing people into payment plans.
Noo question these types of rulings by the courts are going to force the US Congress to pass and even bigger bailout bill sometime after the election in November.
I am buying more gold this week..
4.08% on the 10y, wow!
Shore Guy: What/where are these “leased” properties?
One buys the house, but leases the land. Kind of like he situation in Ocean Grove, but in OG one gets a renewable 99 year lease, with a fixed rent for the whole 99 years. In this case, they expect people to buy a house on leased land but the lease expires upon the death of the 90-year-old land owner. Even if she has great genes, how lone can one expect her to be around.
“Sorry folks , mom dide, now get your house off our land?”
I don’t do condos, I don’t do houses with “associations,’ and I sure as heck don’t do leased land.
gary, just brutal on those bergen 3/2 splits, imho these are some of the same types of homes that a town like new providence or berkeley heights provides but are currently priced at 570-580. regarless i think they the bergen ones are worth between 450-525 based on the fact that they sold at 300ish in 2000 referring to the splits in the northern valley area. i also think bubble mania cause some upgrade mania even though many are still dated. thoughts anyone?
i still have people telling me Bergen county homes will hold up in this market .
you just have to wait it out.
pos capes for 599k
I saw a new listing in Westfield this morning with the following caption on the kitchen picture –
“Original kitchen for the retro lover!” (slight paraphrase)
It was straight out of the 50’s. Your’s for the low, low price of $570K.
are many people in Bergen in denial? i just can’t believe the pricing in
Closter, Demarest, Norwood, Woodcliff lake,
Hillsdale
whats the story?
A couple of Bergen county homes “holding up”. I am starting to see some price reductions (although everything is still way overpriced).
http://njmls.com/cf/details.cfm?mls_number=2813037&id=999999
Was $659 now $599 (not sure what the OLP was)
http://njmls.com/cf/details.cfm?mls_number=2808265&id=999999
Was $699 now $629
grim, #4
I wake up to Bloomberg Radio on my clock radio.
One morning, some economist/analyst was talking about how he expected that after the election, at their December meeting, the Fed would raise rates by 25 to 50 bp, and raise rates aggressively in 2009. I don’t remember who it was, but that’s what I think, too.
But I have sorts of questions about that.
I’m not clear on whether the Fed lowering rates gave a reprieve to some of the ARMs that were due for resets, pushing at least part of the problem off into the future – post-election. I’ve just assumed that it did cool things off a bit.
But wouldn’t raising rates cause resets at higher rates and more defaults?
Is that when the other shoe finally drops?
sheesh
But I have all sorts of questions about that.
I need an editor :)
Check out this pretty good article from CNN on the foreclosure crisis and how it applies to renters. All I could think of when I read this story was for the love of God man, stop paying rent!
http://www.cnn.com/2008/LIVING/wayoflife/05/28/renters.booted/index.html
From MarketWatch:
Charge-offs at 5-year high in banking industry-FDIC
FDIC -insured banks charged off $19.6 bln of loans in Q1
FDIC downgrades 20 banks to problem list in Q1
FDIC sees bank failures increasing
Commercial real estate loans deteriorated in Q1-FDIC
Construction/development loans “a particular concern”-FDIC
FDIC report says end of housing slump in not near
Unsold homes inventory suggests no near term rebound:FDIC
Worsening real estate loans hurt banks in Q1, FDIC says
FDIC list of ‘problem’ banks grows from 76 to 90 in Q1
Latest FDIC qtly banking profile shows continued weakness
Who would you trust, the National Association of Realtors (NAR) or the Federal Deposit Insurance Corporation (FDIC)?
# 58 “Is that when the other shoe finally drops?”
The real question is, “into what will the shoe drop when it falls?”
Interesting anecdotes for the Morristown crowd.
http://www.nj.com/morristown/index.ssf/2008/05/not_the_cafe_arabica_too.html
Who would you trust, the National Association of Realtors (NAR) or the Federal Deposit Insurance Corporation (FDIC)?
NAR of course. Don’t you pay your dues to belong to that prestigious club and put their logo as a proud member on business card.
(sarcasm off)
make,
You need to draw a distinction between wanting to be a member, and having no other choice.
You fail to appreciate the stranglehold that the Realtors have on MLS access. Just about every MLS in the US is owned by the local Realtor boards.
Not a member? No access, sorry.
Not exactly correct, you can have access if you put $2k in an escrow account for them.
You want to pony up the cash?
4.11!
interesting perspective on small, local newspapers. the guy at this blog below is a realtor in Greenwich who used to write a column for the Greenwich Post. He was recently dismissed because of complaints from other real estate agents in the town due to his negative reporting on the local real estate market. To the extent you believe these local papers to be less than reliable on real estate matters, this explains a lot.
http://www.greenwichrealestate.blogspot.com/
#55 mark: I still have people telling me Bergen county homes will hold up in this market .
They are not holding up, and the people telling you that are wrong.
Cliffside Park
SLD 88 SUMMIT TER $840,000 4/4/2005
Acive
ACT 88 SUMMIT TER $869,000 4/28/2008
PCH 88 SUMMIT TER $799,000 5/28/2008
Bye bye Bear!
Glen Rock
2217440 Sold
SLD 36 JEROME AVE $388,000 10/30/2002
2522833 Sold
SLD 36 JEROME AVE $520,000 11/7/2005
2719170 Withdrawn
ACT 36 JEROME AVE $549,000 5/13/2007
PCH 36 JEROME AVE $539,000 7/24/2007
PCH 36 JEROME AVE $529,000 8/31/2007
PCH 36 JEROME AVE $519,000 10/21/2007
W-U 36 JEROME AVE $519,000 11/11/2007
2809536 Active (Same broker/agent)
ACT 36 JEROME AVE $500,000 3/9/2008
PCH 36 JEROME AVE $485,000 4/18/2008
PCH 36 JEROME AVE $479,000 5/29/2008
JB,
You don’t have to take it out of moderation, just take a look for yourself. Around post 71.
Grim – #58 in moderation
#60 Mike NJ
Different states have different laws regarding renters and foreclosures. In NJ a renter with a valid lease can not get thrown out because of a foreclosure (except a few conditions like when the owner also lives on the property). Unless the tenant breaks the lease they just have a new landlord – be it the bank or whomever holds the mortgage.
Here is a good article from the Record regarding the evolution of Renters laws in our state –
http://www.northjersey.com/realestate/NJ_renters_mostly_safe_from_foreclosure.html
grim (35)-
That guy should’ve taken back a note on the house and foreclosed on it himself. He could slap on a coat of paint and sell the damn thing again.
Sort of a real estate version of “tote the note”.
#71 grim:Bye bye Bear!
Did I miss somehing?
Mike NJ Says:
May 29th, 2008 at 10:49 am
Check out this pretty good article from CNN on the foreclosure crisis and how it applies to renters. All I could think of when I read this story was for the love of God man, stop paying rent!
MNJ: This article is misleading. The same thing happened to me in November 1992 in Hoboken. We were advised to stop paying rent to the landlord, and the bank wasn’t going to kick us out anyway for 60 days. Give that our security was one month’s rent AND that we didn’t actually move for 4 months, we ended up paying a new finder’s fee to a realtor and still making out with a couple of extra months.
People just like an excuse to whine and also don’t like to have to move……in reality, they are in a very good financial position.
Shore (40)-
“Gamer? Is than an occupation now?”
Yeah. Look for it at monster.com…right next to “bong designer”.
grim (51)-
Straight to the moon, Alice. However, these high rates are giving lenders time to hoard cash and repair balance sheets. Between the already-high rates and the add-ons, you’ve got to be stone cold perfect to get a mortgage.
Recapitalizing some of these lenders is going to take years (assuming, that is, that C and those of its ilk don’t just keel over and die).
#79 – Not that there was much doubt…
From the WSJ:
Bear Stearns Shareholders
Approve Buyout by J.P. Morgan
By KATE KELLY and RANDALL SMITH
May 29, 2008 11:29 a.m.
At Bear Stearns Cos.’ stockholder meeting on Thursday, Chairman James Cayne for the first time publicly shared his feelings about the demise of the company he ran for 14 years.
Addressing several hundred Bear Stearns shareholders, many of them employees, he spoke of his regret about the dryup of cash that had led to the company’s fire sale to J.P. Morgan Chase & Co. in March. “I personally apologize,” he said, according to attendees, fiddling with the microphone as he spoke. “I’m sorry. Words can’t describe the feelings that I feel.”
Mr. Cayne, 74 years old, noted that he was proud of Bear’s 14,000 employees and that, particularly over the past five years, Bear Stearns had had outstanding results, and was viewed as one of the most admired companies in the country. The chairman, who was named chief executive in 1993, stepped down from that role in January, when he passed the reins to longtime deputy Alan Schwartz. “That was a sad moment,” Mr. Cayne said at Thursday’s meeting. “This is equally sad. The bottom line is, that life goes on.”
He also quoted Nietzsche, saying: “That which does not kill us makes us stronger.” He added that media accounts of Bear Stearns’s bank run had been inaccurate. “Don’t believe what you read in the press,” he said. “It isn’t true — it isn’t even close.”
Mr. Cayne, who led the meeting, was accompanied on the dais of the firm’s second-floor auditorium by CEO Alan Schwartz.
In his own brief remarks, Mr. Schwartz expressed his admiration for Bear Stearns’s employees. “They continue to act like the consummate professionals they always have been,” he said. “I, for one, will always be proud to say I was a member of that team.”
At about 10:05 a.m., Mr. Cayne announced that the merger had been approved, without providing details of the vote count. He added that the deal is expected to close on Friday.
#83 grim: yeah just saw that.
… there should be additional provisions that protect borrowers from having their credit rating destroyed when they go through foreclosure.
So…Without a hit to your credit, there will be virtually no consequences to walking away from your bad investment. Why would anyone with negative equity stay in their home at this point?
Rich are you insinuating that Duck dropped his price?
I’m starting to lace up the boots, Bob.
To quote NJPatient, nice weather we’re having.
Oh screw it! YES!
Rich,
Wow, I didn’t even realize Duck had his place back on the market.
I gotta get up there and see how big that crack ACTUALLY is.
NEW YORK (MarketWatch) — The Federal Reserve Bank of New York said in a statement Thursday that it expects to conclude the arrangements necessary for the financing of J.P. Morgan Chase & Co.’s (JPM:JPMorgan Chase & Co acquisition of Bear Stearns Companies Inc. (BSC:The Bear Stearns Companies Inc
BSC 9.55, +0.17, +1.8%) on or about June 26. The U.S. Treasury Department and New York Fed helped engineer the $2.2 billion buyout deal after Bear collapsed March 14. Bear shareholders voted to approve the deal Thursday and said it would close Friday.
Didn’t he say he would NEVER take a loss and that the market would rebound this spring?
4.11!
Go baby go!!
When we get to double digits then and only then would we see who’s swimming naked. It’s gonna be one of those all nude resort!! US becomes the garden of eden!!
Say buy buy to Alt A, builders, what’s left of buyers and hello to FDIC.
The faster we get there the easier the pain would be.
Obama should put Paul Volcker on his ticket as a VP. I’ll wrap myself up in a US flag and go cast that vote.
Since you are all in such a good mood, i hope you won’t mind answering my question :)
I’m in favor of Independent 529 ( prepaid program ) as against the state sponsored 529 plan because …
1] I gather both have the same tax advantages. 12K per year/60K for 5 years.
2] NJ state plan offers limited investment opportunities.
3] Since i have two kids and don’t plan on helping them with more than 50% of their tuition fee, there is a good chance that at least one of the two will attend college at a member university. Hence the possibility of forfeiting my investment because of non attendence is less. I know they give your money back but the rate of return is less than +/-2%.
Am i missing something? Any help is appreciated.
#92 Rich: Thanks for the River Edge price information. Nice to finally see prices going (significantly in quite a few cases) down, but of course there is still more room for prices to go down. And they will of course continue to go down.
Still amazed that there appears to be a fair number of houses under contract, but lets see if they all close.
One more year (this time next year), should do it as far as very large significant price declines.
Economic and financial statistics are the battleground over which the war of perception is fought. But as the saying goes: “Figures lie, and liars figure.”
One vital statistic in the perception battle is GDP, which is the total of all spending on goods and services within our economy, and is used as the key measure of national wealth generation. It may be surprising to some, but GDP includes money spent on clearing up natural disasters that include hurricane relief and pollution control. How such expenditures, which really only replace what has been lost, increase national wealth, is beyond me.
Unemployment figures are another worry. Government adjustments for seasonal and population changes are acceptable. But excluding from the unemployment rolls those who are neither actively seeking jobs nor the ‘long-term’ unemployed is not.
Perhaps, the greatest area of concern about statistical manipulation is the measurement of inflation, or Consumer Price Index (CPI). By manipulating this single statistic the government can miraculously transform rising prices into economic growth.
Today, the Department of Labor sets so-called “core” inflation, excluding food and energy, at 2.2 percent. Even “headline” inflation, including food and energy, is published officially at only some 4 percent. The problem is that these figures bear very little relation to the reality of price increases experienced on Main Street, which some estimate to be in excess of 10 percent.
# 96 Ahhh, turning lead to gold. Who said that one needed a nuclear reactor or an wizard to do this. All it takes is a government employee sitting under bad lights at an old green desk.
“these figures bear very little relation to the reality of price increases experienced on Main Street”
The decisionto treat improvements in a product, even if the price goes up, to be a price decrease helps with this. Also, the basket of goods includes certain items that get purchased rarely, and is not weighted towards typical monthly purchases.
grim (83)-
Well, at least Cayne now has more time to decorate his new apartment, play bridge and do bong hits.
From the FDIC:
Quarterly Banking Profile – Q1 2008 (PDF)
re: (83) Fitting that Jimmy Cayne quoted a self proclaimed immoralist like Nietzsche.
I gotta get up there and see how big that crack ACTUALLY is.b>
From the Listing…
…GREAT OUTDOOR PATIO, 3 TERRACES, 3 BALCONY’S,2 CAR GARAGE. MODERN HOME IN GREAT CONDITION. THIS HOUSE WON’T LAST. CALL TODAY FOR MORE INFORMATION (emphasis added)
At least they are being honest about the crack.
italics off
RE 94 only fund the older kids’s 529 plan if you only have funds to pay for 50% of each kids college.
If you do 50/50 the younger kids 529 is considered an asset to the older kid and will hurt his shot at financial aid. If you do 100% older kid if the older kid does not use all of it or gets a scholership the younger one is automatically entitled to use funds.
Worse case if you do 50/50 older gets less financial aid because of funds in younger ones 529 and then younger one gets scholership or does not go to college and you pay penalty to get money back out of younger ones 529 plan.
Plus with younger one you have higher shot at financial aid as in todays enviornment when you hit the 50’s you are going to get packaged out.
Personally I feel their is a certain level of moral hazzard in saving for your kids education, plus unlike the first generation asians whose parents mortgage the farm to send their kids to Harvard without worry as they know their children will respect their olders and support them when they are old if they have money problems most american snot nosed brats will suck up your life savings for school and if you are lucky will drive their S class to visit you in the poor house once a year once they are a rich doctor or lawyer.
3B,
FYI: I’m sending you an email to your gmail account.
Rich
#105 rich: Not to sound like a moron, but i do not think I have a gmail account.
Any good stuff in the e-mail?
I’m not sure how many of you remember the winter of 2005 when natural gas prices skyrocketed to $16 from the typical winter peak around $9. Everyone was in shock when they saw their energy bills almost double that year. Well 3 years later, we have not done enough to increase our NG supply and the current level in storage as of today is now lower then what was in storage ahead of the winter of 2005.
http://americanoilman.homestead.com/GasStorageGraph.html
These levels are considerably lower than what they were at this time of the year in 2006 and 2007.
Why? Well once NG prices dropped as supplies increased, the impetus to discover more NG reservoirs decreased. Well you can probably add massive heating bill increases to your list of headwinds facing the homeowner in the Northeast this winter.
Typically at this time of the year, NG futures price around $6. It is currently close to $12. Even in the Summer of 2005, it was only $7.
http://futures.tradingcharts.com/chart/NG/M
Although this is purely speculation, it is entirely plausible that your energy bill will double this winter. If it is a cold one in the Northeast, it could very well triple. So my 2-family home energy bill will go from $600 to somewhere between $1200 and $1800. We typically have three huge bills each winter. So what is another $2700? Stimulus check be damned!
Housing and banks are so F’ed!
And so is Obama!
Arrgh. Grim 107 in moderation!
Thanks John! Your suggestion was very helpful.
I will try and not complain when my kids don’t show up at the old age facility :)
3B,
1. Check your email account that you used to email JB.
2. No.
(86 & 89),
Kinda sad, he posted over at HousingPANIC!
Also, if you want to see a few more rants do a search on “Alpine the Realist”
Just getting here, so apologies if this is already posted:
http://tinyurl.com/684ccq
Recalling the suburban gas riots of 1979
By Derrick Nunnally
Inquirer Staff Writer
This much can be said for the advent of the $4 gallon of gas: It has not driven anyone to run riot. Yet.
Twenty-nine years ago, service-station owner Steven Lankin watched as a summer-night Levittown crowd seething over gas rationing, two-hour lines at the pumps, and a then-stunning hike to $1 a gallon turn violent.
What began as a truckers’ gas-crisis protest lasted two nights, June 23 and 24, 1979. It drew thousands of people and left 100 people injured, nearly 200 arrested, and one Shell station shattered in the first gasoline revolt in American history.
When inflation is considered, today’s drivers are paying more for gas; $4 in 2008 is equivalent to $1.35 in 1979 terms. Even so, the gas-buying crowd remains civil, though unhappy, at Levittown’s Five Points intersection, where the riots broke out in front of the Getty station Lankin has run since 1964.
“I don’t know how they expect us to live,” said John Brooks, a construction worker for Amtrak, filling up his motorcycle at Lankin’s pump Friday for $3.86 a gallon.
Every few days, a phone call from Getty’s central offices instructs Lankin to raise prices a few more cents, and as he dutifully does, tempers at the pump rise, too. But neither anger nor prices are climbing as they were in June 1979.
“In those days, it wasn’t like a degree at a time,” Lankin said. “It was, like, boom! And the public, they got . . . [angered] good.”
In the riots, car tires and a junked car were burned in the streets, Philadelphia and state police officers were bused in, and most of the gas stations at the intersection were vandalized. Police-brutality lawsuits were filed and eventually settled for $154,000. And national attention was drawn to a community founded as an iconic planned suburb in the early 1950s to embrace a car-centric vision of the American Dream.
“Social disorder in Levittown? The postwar era really has ended,” George F. Will wrote in Newsweek after the riots.
More at the link….
http://www.cnn.com/2008/LIVING/wayoflife/05/28/renters.booted/index.html?eref=rss_topstories
Regarding the $30K in rent story…my question is what happens if there is a lease.
I was wondering if anyone had any information/advice for a renter of a building that is being foreclosed on. I have a friend who just received a letter saying the building was in foreclosure and she has until the end of June to move out. (Her lease ends in Dec.)
I have found out that “NJ leases survive the foreclosure” however I have not found anything that goes in depth on the rights of the renter in a foreclosure situation. Does any one have any good resources on the subject or am I stuck searching through NJ property laws?
#110 Rich: Got it, thanks.
#110 Rich Nothing there yet. I will be on the lookout for it.
I’m not sure how many of you remember the winter of 2005 when natural gas prices skyrocketed to $16 from the typical winter peak around $9. Everyone was in shock when they saw their energy bills almost double that year. Well 3 years later, we have not done enough to increase our NG supply and the current level in storage as of today is now lower then what was in storage ahead of the winter of 2005.
http://americanoilman.homestead.com/GasStorageGraph.html
These levels are considerably lower than what they were at this time of the year in 2006 and 2007.
Why? Well once NG prices dropped as supplies increased, the impetus to discover more NG reservoirs decreased. Well you can probably add massive heating bill increases to your list of headwinds facing the homeowner in the Northeast this winter.
Typically at this time of the year, NG futures price around $6. It is currently close to $12. Even in the Summer of 2005, it was only $7.
Although this is purely speculation, it is entirely plausible that your energy bill will double this winter. If it is a cold one in the Northeast, it could very well triple. So my 2-family home energy bill will go from $600 to somewhere between $1200 and $1800. We typically have three huge bills each winter. So what is another $2700? Stimulus check be damned!
Housing and banks are so F’ed!
http://futures.tradingcharts.com/chart/NG/M
Other link to support my thesis ;)
galgon
Someone posted this link last year.
http://www.lsnjlaw.org/english/placeilive/irentmyhome/tenantsrights/chapternine/index.cfm#ch9
Now if only that dude from Amerinth was able to hold this long. He could have been the next Warren Buffet ;)
One predictable aspect of higher gas prices and municipal budget meltdowns is slower drivers. But I was unprepared for what I am observing now.
Recently, I have observed NJ drivers doing the unthinkable: Driving at (or even under) the speed limit!!! And not just one or two, but an actual measurable percentage. Used to be, if I drove the speed limit (yeah, right) everyone would pass me or crawl up my tailpipe.
And fewer SUVs are blowing by me on 78 on their way to Upper Haughtyville. Less tailgaters too (probably because I haven’t slowed down much).
Nay, you say? Gas prices alone would not slow the notorious Jersey Driver, right?
Obviously, gas has reached a tipping point and drivers have finally started to adjust their behavior en masse. But there would have to be more to cause such a large shift, and, when you think about it, there is more.
The cop brat in me senses when cops are around, and the antenna has been twitching nonstop lately. Logic dictates that less tax dollars would result in more enforcement as munis unleash the cops to shake the money tree, and
I see cops everywhere now. When I drive, I usually try to look for good speedtrap locations, and very rarely I will see them occupied. Now it seems like a quarter of the time, I find cops where I expect them to be.
So be aware, all you Jersey Drivers. The state and localities are counting on you to cover the budget shortfalls. Further, I predict that unlike prior shows of force that last brief periods, this is likely to be a long term thing.
[117] Stu,
I am using UNG as a hedge. Probably not a great hedge, but I don’t need an options account to buy it.
Re: SUV’s
The thing I always find amusing….on these last few days of warmer weather, these conestoga wagons all have the windows rolled down. Seems the AC really drains the gas gauge.
#110 rich: Any bad stuff in the e-mail?
Nom Deplume [123]:
I bought Nabors (NG driller) to hedge my heating costs in 2005 and it performed better than I could have ever expected. Bought more of it this late winter and am already up over 30%. Those NG service stocks always run lockstep with the inventory chart. Of course, a warm winter means a potential stock loss ;)
Speaking of drillers, RIG won’t stop (yet).
Recently, I have observed NJ drivers doing the unthinkable: Driving at (or even under) the speed limit!!! And not just one or two, but an actual measurable percentage.
One of thouse slow folks is me. Started about 2 weeks ago to try to finally get more than 27MPG combined gas mileage out of my 14 years old camry…
Yeah, I dont see many speeders at all on the highways, maybe 1 or 2. What I do see however, is a majority of the drivers on the road have their heads so far up their arses I barely consider them to actually be operating a vehicle, let alone operating mentally.
[125] Stu
Kicking myself for not buying RIG over the winter when I was thinking about it, but was still licking my wounds elsewhere and very gunshy.
Sounds like you have a better NG hedge, at least on gains. I just bought so I am flat, but it is a hedge. My only concern is that more supply will come on line, driving prices down. In that case, the drillers will likely outperform UNG, so I should consider buying that on the dips.
Bought XOM as an oil/gas hedge, and did all right, but the refining squeeze hasn’t helped the stock. Also bought BNI as an oil/coal play, and that is up 30%
Does anyone have access to this? Can you post the article?
http://ml-implode.com/viewnews/2008-05-28_BreakingNewsCitisBeckmannOutMoreLayoffsatChase.html
3B,
No, just my contact info.
The DOT really needs to put up signs that read “Left lane for passing only” or “Slower traffic keep right”
That would get rid of all the road rage out there…
njrebear:
Thanks for the link. I thought I remembered someone in a similar situation posting her before.
Oh, and rubbernecking should be punishable by catapult!!
Why? Well once NG prices dropped as supplies increased, the impetus to discover more NG reservoirs decreased
There are plenty of discovered reserviors around the world. It’s more a matter of infastructure to liquify the gas and ship it.
Right now worldwide demand is high. Much of the supply is going to Japan and China.
Nom,
You seem to invest quite similarly to the way I do. I wouldn’t be careful with the coal stuff, especially domestically. It is very ungreen and environmental issues will be pushed more and more to the forefront in the developing markets. You can’t even breathe in parts of China and India is much greener than the US on many fronts. Coal is really not part of an environmental solution, even if the lobbyists claim they can burn it cleanly. My butt! Nuclear still has the waste issue and oil might be peaking. Now if LNG takes off, it will be a big part of our energy solution. Of course, I am bit biased ;)
wouldn’t should have been would.
Sheesh!
I note that Gold is dropping down to my mental stop loss point. I want to stay in, but I’m wondering where this down leg is headed.
My entry point is way back at $280/oz range. I think I might lower the trigger point.
Stu,
True enough about coal, but as long as the Powder River Basin can sell all it can mine, and BNI can haul it, then Warren and I will continue to hold the stock.
Your take on NG is good, and I was leery of NG because of the fact that capacity, not supply, is the issue, so maybe I invest more in capacity.
I may look into solar, probably an ETF.
122: Nom
5-0 has stepped up their patrols because of the “click it or ticket” seatbelt enforcement BS.
Ask me how I know.
$44.00 poorer,
Jason
I wish they would enforce the cell phone ban already. I could give 2 sh*ts if you get killed in a car accident because you were too stupid to not wear your seat belt, but when you side swipe my Civic while dialing your beauty salon to make a nail appointment…well then I have issues that I’m concerned with!
#131 Rich: Thanks Rich. Thanks for all of your help.
njre 1071
HP 1050
Vote here!
http://www.fhamortgagecenter.com/contest/view.php?id=73
Coal is really not part of an environmental solution, even if the lobbyists claim they can burn it cleanly
The problem with coal is that there is no way to currently deal with the CO2. For pollutants with air quality impacts (NOx & SO2), with proper controls, coal can reach emission levels similar to that of natural gas. If China retorfits its coal units with modern controls (SCR, FGD, ACI + ESP & baghouse) it could solve much of its air quality problems at a lower cost than burning gas. Since CO2 doesn’t really cause air quality issues, they may very well not care.
141 – Stu
for the past few days, there have been cops standing in the middle of rt 4 during rush hour in elmwood park and fairlawn (i think they were county or state cops, not borough cops) pointing at cars to pull them over if the driver is on the phone.
…so it seems like they are starting to enforce it.
Stu (118)-
Nobody has to wait for Winter for NG to blow up. Just wait ’til everybody has to crank their ACs.
“Peaker” electrical power plants and smokestack emission scrubber systems eat NG like there’s no tomorrow. Not to mention, all the fertilizer we need to dump on our genetically-engineered ethanol corn takes huge amounts of NG to manufacture.
RIG has been a favorite of mine, but I also like NOV, WFT, CAM, FTI.
All disclaimers. I also thought the Celtics couldn’t win a playoff road game.
NE, DO, IO, HERO, DWSN, CLB are a few others in the oil service area you may be interested in tracking. I’ve been in and out of a few of them over the course of the year.
SSL had a huge run up the past few months but I missed out on that one. Was in it last fall and did ok. They are basically the only real show in town in South Africa for oil, nat gas and coal. They are also one of the leaders in liquified coal tech.
I am practically all in cash right now due to stop limits. Wait until the month ends before I am getting back into anything new.
I of course don’t offer any investment advice as I don’t have any sort of financial background other than balancing my own checkbook.
Nice Clot. If the CEO of Nabors dies (he’s an old coot), their EPS should grow substantially. He is paid like Dennis Kozlowski, but can’t speak in complete sentences. Check out this quarterly call transcript…
http://seekingalpha.com/article/73429-nabors-industries-ltd-q1-2008-earnings-call-transcript
This guy Izenberg makes $50 million per year + stock and other incentives! Company only makes about 1 billion per year. CEO takes home close to 5% of earnings in salary alone. He dies and EPS grows by at least 3%. Pure craziness!
http://www.whitecastle.com/_assets/Multimedia/slyder/secret_pop.html
If we could harness the methane gas produced at White Castle we could solve the energy crisis.
Here is one $50 million quote:
“The answer is both, I think we are looking to increase it, we have a whole Mexican products and we’ve recently used the manufacturing entity to international, so we frankly disassociated from the scripts USA and Nabors and having pretty good success I would say getting hesitant information the way I think for example, not bad, but in China they are doing really good compared to Nabors. And some of the new products are really doing well, and that was a backdrop obviously.”
I love this…..
“Randolph said before last night’s game that he expected to put Delgado back in the lineup tonight, but given the chance to pinch-hit him for Damion Easley or Fernando Tatis in the eighth against righty reliever Matt Lindstrom, Randolph passed, and it was the right call. Delgado couldn’t hit Lindstrom’s fastball if Lindstrom were throwing from second base. He’s toast, and the fact that he was sitting the past two nights (especially with the Mets already missing both corner outfielders) sends the message that the status quo is no longer acceptable around Shea.”
Maybe Delgado could get into a taxi accident?
ChiFi… Know what I can’t get? How can a team with such solid pitching (sans Heilman) and a 140 million payroll be under .500 in the standings?
Coaching!!!
The fact that every unknown guy on the team is hitting .300 and every overpaid buffoon is closer to .250 points to a lack of leadership.
John (149)-
Can’t get the methane from White Castle, but DAR turns the fryolator grease into bio-diesel.
People laugh, but DAR is one helluva company. Chart:
http://tinyurl.com/5n2szo
[140] Jason,
Sorry, no sympathy from me.
When I was in college a bazillion years ago, I drove a bus, and seatbelts were de riguer if you wanted to stay employed. I got in the habit and stayed there.
Who needs a HELOC when you have one of these?
U.S. workers warned about 401(k) debit card perils
The Financial Industry Regulatory Authority, a non-governmental agency, said the card is a hybrid of a debit and credit card that charges a fee plus interest for accessing money in a retirement account.
“Regardless of how easy it might be to do, borrowing against your retirement savings should be a last resort and done only in emergency situations,” said John Gannon, FINRA senior vice president for investor education.
I don’t know about you, but the purchase of this 60″ Plasma is a life or death decision for me.
Blame Oil Prices on the Fed and the increase in the money supply.
http://www.cnbc.com/id/15840232?video=755108158
Seat belts improve your chances of surviving an auto accident by 50%. Death caused by auto accident is about 1 in 50. Wear your belt and it becomes 1 in 100. I think it’s worth it.
re: #156 Grim going for the gusto I see, be sure to check Amazon they usually have the best price.
FYI, I hope you realize that the recommended seating distance from any TV is 5x the size of the screen. 25 ft may seem like allot but it isn’t since the viewing distance for a smaller 19″ TV is near 8 ft, which is the standard living room size.
grim (156)-
Playing the new version of Grand Theft Auto on a TV like that must be the bomb.
Sean,
I believe Grim’s comment at 156 was a tongue in cheek response to his own post at 155.
Besides, if he wants the best price he’d go to
AntiCost!
(161)-
Another shameless shill of a promo for AntiCost…
Can AntiCost handle payment via a 401k debit card?
(162),
It’s either that or click HERE!
(162),
But I’m sure if THIS pans out we’ll have a happy moderator.
Nom,
I’m with you on the belt usage. He got me about half a mile into my trip and wouldnt let me go after seeing my address. Paid my penance, and moved on.
Better to see them hitting cell-fish phone users though.
Can someone with GSMLS access please tell me the status of 4 Haran Circle in Millburn? If it’s UC, what is the anticipated close date. If it closed, what was the price?
Thanks.
“U.S. workers warned about 401(k) debit card perils”
big mistake.
SAS
re: #161 sigh, I am getting slow in my old age, I should have know when Grim said Plasma since that technology is so over, anyway I was not kidding about Amazon. I saved over $1k buying a new LCD TV from them last year.
And Clotpol the graphics in Grand Theft Auto is childsplay compared to a game like Crysis which was developed by the Germans.
Sean (168)-
Thanks. Actually, I’ve never played a video game in my life. If given the choice between video gaming and jabbing a rusty awl into my hands, I’d take the latter.
Clotpoll – rusty awls are also a good way to get rid of agression, at least you aren’t kicking your dog or wife around.
I thought the big advantage of the 401k debit card was that if you change employers, you don’t have to pay back the loan immediately as per a conventional 401k loan. Thank goodness I have a Best Buy within a short drive so I can pick up my 60″ plasma – have you seen gas prices lately?
FYI, I hope you realize that the recommended seating distance from any TV is 5x the size of the screen.
Then JB is going to need a new McMansion to put the 60″ TV in. He can put it on his 401(k) debit card.
I like the Govt’s explanation for the lower oil supply reported today – there’s more of it but they are having trouble getting it off the ships. Is that typical Bush admin bs?
# 174 Because the ships are in Indonesia, Japan, etc.?
173 even
Bring On Alt-A Downgrades
http://www.minyanville.com/articles/mortgage-wm-washington-Mutual-downgrade-pool/index/a/17358
A Roth Debit Card has to be next. That would be a fun one for sure. I guess defaulting on yourself is a sure fire way to entice people to leave the car running in the garage with the door closed.
No flat screens for me, I own a tube tv.
jb
If it’s UC, what is the anticipated close date. If it closed, what was the price?
Went UC on 4/26, AC is 06/16
Just one of those quality NY Post headlines:
LIVING LA VIDA LESBO
http://www.nypost.com/seven/05292008/entertainment/living_la_vida_lesbo_112948.htm
unmod
Clotpoll Says:
May 29th, 2008 at 4:12 pm
Sean (168)- Thanks. Actually, I’ve never played a video game in my life. If given the choice between video gaming and jabbing a rusty awl into my hands, I’d take the latter.
Do you remember Gorf? I could play about 90 minutes for $0.25…..
http://en.wikipedia.org/wiki/Gorf
My first car had no seat belts!! It was a piece of junk 1963 Dart Convertible. The last year before seat belts became mandatory. It had two buckets with no headrests and a push button tranny so their was nothing between the seats. One night I was pulling a starksy and hutch move and some bannana head in a monte carlo didn’t see me and t-boned me drivers side at 40 miles an hour. Well I landed in the passenger’s lap and thanked God I did not have a seatbelt on.
40 pounds of bondo, a piece of plastic for the window, two guys to push the top sideways, an electic metal cutter and a few moves with a jack wedged vs. a cement wall and that bad boy convert was all set for senior beach day!!!
Anyhow I never wore seat belts for around the first ten years of driving, in fact a year after the dart crash I was seatbeltless in the back of a camaro that was just about to buy a telephone pole are around 50 MPH and I was able to grab my seatbeltless friend in the bucket in front of me last minute to keep him from going through the window.
Well I should have cashed in my chips at that point but I didn’t and I was in the backseat of another car seatbeltless where it bought a tree at 60MPH. Trees don’t move but people do and after the part of the car that didn’t stick to the tree finished its triple rollover and I got a face full of dirt I officially became a little chicken seat belt wearing pain in the butt for life.
Funny part of that crash was the front passenger was a back up center for a final four college team in his day. He was seatbeltless cause they don’t fit him well. So anyhow we left the front passenger door in the tree and the dashboard pinned him so he did triple roll over with no seat belt or door!! He looked fresh as a daisy when we stopped so anyhow they pull that bad boy out with his broken pelvis and he is soo damm big that the EMS people could not lift him out of ditch and they almost dropped him a few times. He was moaning and groaning like a baby girl, even funnier the driver walked away unharmed and was playing ER with the broken pelvis guy who wanted no part of it since he was the idiot who dozed off and hit the tree.
stu, nom
coal is also one of the largest sources of radioactive pollution. i go into detail and site sources on my blog link if you are curious ( click on my name)
clott,
natural gas will not see significant spike suntil fall/winter barring unexpected events. This is beacuse power plants use the gas in the summer for the increases AC demand and as soon as that drops off the residential usage takes off for home heating. The problem is that the US currently has supply bottlenecks so the NG reserves cannot be replenished before the winter spike. the root of the problem is that more power generation is being shifted to NG while home heating is also shifting to NG.
if anyone is curious about the gory details then look at theOildrum.com
they have had several indepth articles about it
179 – Thanks Grim!
122 Nom Deplume
I would not say nay. Verily I say unto you that I would say yay, because I have noticed the selfsame thing.
The slowness, it has increased.
#145
for the past few days, there have been cops standing in the middle of rt 4 during rush hour in elmwood park and fairlawn (i think they were county or state cops, not borough cops) pointing at cars to pull them over if the driver is on the phone.
…so it seems like they are starting to enforce it.
From experience i can tell you that they are either doing Click it or Ticket or checking to see if you have a commercial vehicle and aren’t using commercial plates. I work for a Non profit org and i can’t tell you how MANY times i’ve been pulled over for this. They just don’t understand that it’s not a commercial vehicle. I’ve never gotten a ticket though as they see Bergen County on the side of the van and leave me alone.
134 tbw
“rubbernecking should be punishable by catapult!!”
I love that image.
You know what drives me blind with madness? Motorcycles that white line. Man if i didn’t have a conscience i’d open a door.
Clot (re “…must be the bomb”) you’re showing your age. Haven’t heard the phrase “the bomb” since I saw clueless in 1995.
(after discovering her boyfriend shaved his head)
Dionne: “Murray, what have you done!”
Murray: “I’m keepin’ it real! Look at Lawrence’s head”
Lawrence: “It’s the bomb!”
141 stu
“I wish they would enforce the cell phone ban already. I could give 2 sh*ts if you get killed in a car accident because you were too stupid to not wear your seat belt, but when you side swipe my Civic while dialing your beauty salon to make a nail appointment…well then I have issues that I’m concerned with!”
Thank you. When I see someone driving eratically, it invariably turns out that they have a cell phone to their ear, and I see it constantly. They should balance the state budget on those MFers.
#191
I’ll tell you why people aren’t getting pulled over as much as they should or at all. I’ve seen MANY cops using cells while they drive as well. It’s mind bending.
john,
some great stories you have there, but….
Anyhow I never wore seat belts for around the first ten years of driving, in fact a year after the dart crash I was seatbeltless in the back of a camaro that was just about to buy a telephone pole are around 50 MPH and I was able to grab my seatbeltless friend in the bucket in front of me last minute to keep him from going through the window.
this is highly unlikely. F=MA; assuming your friend weighed about 75 KG ( approx 165 lbs), the car deccelarted in 0.5 seconds form 50 mph, then your friend would have been thrown forward with a force of about 750 lbs. it is highly unlikely that world class strong men or body builders could withstand that much force. and average individual CANNOT. you also would have to account for impulse with makes it even more unlikely that such a feat could be achieved by anyone.
newton says you are full of it on this story
The Camaro he got lucky, I dove forward grabbed him around the chest from behind as I saw us head for the pole at 50 mph. The driver hit the Slow down sigm then hit the stake with the thick metal wire that was attached to the pole. The wire spun under car and wrapped around it and we then driver sided into the pole. I barely held on to him during the sign and wire part of the head on part and the wire sent us sideways so that was all I needed.
My sis and bil are moving back to NJ from Cali. They placed craigslist ads offering their scooters for sale. My BIL had several replies from SUV owners looking to straight up trade their hulks for a used Piaggio. Total desperation out there … taking a loss of several thousand dollars on an SUV just to save a hundred or so per month at the pump makes no sense. Then again, if you’re as highly leveraged as the typical consumer, you need that extra breathing room even if it only lasts a few months.
Fresh thread upstairs!
25 ft?? Well I have 130″ HD screen (no typo) and can comfortably sit much closer than that.
LCDs are good for brighter rooms, plasmas still can have good attributes depending on the environment.
If you can control ambient light, projectors are really the way to go. The new Sanyo Z2000 is 1080p and reportedly an incredible unit (I have a much older version which is still quite amazing).
I’m sure the 401(k) card could put together a system.
Yikes, what a scary thought.
Decent 1080p front projectors can be had for less than 1500$ online.
Like the previous poster said, it is definitely cool if you can control light.
I know that everyone is excited about the LCDs but every time I look at the flat-screen TVs my eye is drawn to the plasmas. Who has seen an LCD that stands up to the plasma screens?
Can someone provide address, history, and property tax for MLS#2813616? Thanks.