Weekend Open Discussion

Happy Recession Hour GTG (Get Together)
Friday, July 18th 5:30pm
Johnny Utah’s ( http://www.johnnyutahs.com )
25 West 51st Street, NY

Cancel your f’n plans, I don’t want to hear excuses.


This is the time and place to post observations about your local areas, comments on news stories or the New Jersey housing market, open house reports, etc. If you have any questions you wanted to ask earlier in the week but never posted them up, let’s have them. Also a good place to post suggestions, requests for information, criticism, and praise.

For readers that have never commented, there is a link at the top of each message that is typically labelled “[#] Comments“. Go ahead and give that a click, you might be missing out on a world of information you didn’t know about. While you are there, introduce yourselves to everyone.

For new readers that have only read the messages displayed on the main page, take a look through the archives, a substantial amount of information has been put online in the past year. The archives can be accessed by using the links found in the menus on the right hand side of the page.

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372 Responses to Weekend Open Discussion

  1. Mr. Oliver says:

    I’m first! Yay! And still renting!

  2. Orion says:

    Should be an interesting day, at the beach that is…..

  3. njpatient says:

    2nd. Yay! And still renting!

  4. njpatient says:

    It’s going to be a long day. I need a drink.

  5. Pat says:


    June unemployment and job-growth figures released Thursday by the New York State Department of Labor paint a dim picture.

  6. Pat says:


    New Jersey’s unemployment rate inched down one-tenth of a point to 5.3 percent in June, but the state lost more than 4,000 jobs.

  7. Pat says:


    “In the information filed with his June 19 plea agreement, Birkenfeld outlined some of the methods the bank used and some of his activities, including purchasing diamonds abroad and then concealing them in a toothpaste tube to smuggle them to his U.S. client.”

    Couldn’t he have stated that he was simply cleaning the diamonds?

  8. Pat says:


    The rules, which apply to 159 banks with at least $2 billion in U.S. deposits and either $20 billion in assets or 250,000 account holders, start Aug. 18, the Washington-based regulator said in a notice to banks published yesterday on the FDIC Web site.

  9. bairen says:

    Citi lost 2.5 billion. Took 7.2 billion in write downs.

  10. grim says:

    From MarketWatch:

    Citigroup swings to loss on $7.2 billion write-down

    Citigroup, the largest U.S. bank by assets, said on Friday that it lost money for the third consecutive quarter after writing down $7.2 billion of investments related to fixed income weakness and consumer credit woes.

  11. grim says:

    From the WSJ:

    Mortgage Giant Freddie Mac
    Considers Major Stock Sale
    Issue of Up to $10 Billion
    Would Aim to Stave Off Rescue Plan
    July 18, 2008; Page A1

    Mortgage giant Freddie Mac — emboldened by emergency regulatory actions that have triggered a two-day rebound in its battered stock — is considering raising capital by selling as much as $10 billion in new shares to investors, according to people familiar with the matter.

    The high-stakes maneuver would have the potential to avoid a full-blown government rescue for Freddie Mac and Fannie Mae, twin keystones of the U.S. housing market. The publicly traded, government-sponsored companies own or guarantee about $5.2 trillion of home mortgages, or nearly half the total outstanding, and are at the center of government efforts to prop up the sagging housing market.

    Both companies’ stock fell about 45% last week amid worry about whether they have enough capital to cover mortgage losses. The depth of their troubles spurred the Treasury Department on Sunday to unveil an unusual plan to temporarily extend an unspecified credit line to both companies — as well as buy stock in them if necessary.

    That plan quickly came under fire on Capitol Hill. Critics argue it could cost American taxpayers billions of dollars.

  12. njpatient says:

    “Citi lost 2.5 billion. Took 7.2 billion in write downs.”

    That CAN’T be true!! bi (and S&P) said there would be no more writedowns!!! bi, tell ’em it’s not true!!!!

  13. bairen says:

    Freddie wants to raise 10 billion?

    That’s merely a speed bump on the highway to hell.

  14. bairen says:

    #16 njp

    I was so tempted to write that, but didn’t want to swipe your line.

  15. njpatient says:

    feel free, bairen. What if I had a coronary infarction and wasn’t able to post and you didn’t know about it until too late?
    We would miss a prime chance to make fun of bi.

    That can’t be allowed to happen.

  16. njpatient says:

    Just watched the Bunning/Paulson video. Great stuff. Paulson’s a crappy speaker in any event, but he doesn’t usually stutter quite that much.

  17. Clotpoll says:

    A 7.2 bil writedown becomes a cause for celebration. DJIA futures swing positive after announcement.

    Can’t make this stuff up.

  18. x-underwriter says:

    grim Says:
    Mortgage giant Freddie Mac is considering raising capital by selling as much as $10 billion in new shares to investors, according to people familiar with the matter.

    Who in their right mind would be buying these? They’ll be luck to get $1/share.

  19. Cindy says:

    Write-down, write-down, write-down…
    write it all down…what’s left?

    Has it been 380B so far…on its way to 1T or more…it seems to be taking forever.

    (12) Pat “FDIC sets new rules on US Deposits to Avoid System Failure.”

    “The change will help pay off insured deposits as soon as possible and help “maintain public confidence in the banking industry,” the regulator said.

    Public confidence? As they drag out these write-downs I think it is tryly messing with what confidence there is left…

  20. Cindy says:

    well tryly should be truly…

  21. Cindy says:

    I know I’m an idiot because all that will be left is more write-downs as the CC, student loans etc. come on board as well…

  22. njpatient says:

    5am out by you?

  23. BC Bob says:

    5am out by you?”


    It’s happy hour somewhere.

  24. x-underwriter says:

    Clott, Regarding SKF

    Bank stocks rally! Great selling opportunity!


    But if you’re wondering whether this is a time to jump back in …

    My answer is a flat, unabashed “NO!”

    Reason: The massive exposure most banks have to souring assets has just begun to be revealed. Nothing has changed. And the rally you’ve seen this week is minuscule in contrast to the huge declines we’ve seen over the past 18 months.

  25. Cindy says:

    (26) Yeah, 5AM – I wake up at 3 or 4. I’m usually in the classroom by 6:30 or 7:00…in bed by 9. Habit. Teachers are brain dead by the end of the day. I wake up early, read – do thecrossword and sudoku..check out what you folks have to say.

    I had a very sobering exchange with skep-tic last night. You probably don’t remember when I first started reading back in December of 2007. It was after reading Greenspan and being disillusioned that he had not accepted much responsibility for the mess then. You folks were discussing what a “hack” he was.

    Well, I’ve come a long way baby….

  26. BC Bob says:

    “Teachers are brain dead by the end of the day.”


    It could be worse. WS gurus are brain dead at the start of the day.

    By the way, I haven’t heard pundit in awhile. Did that get buried with goldilocks?

  27. njpatient says:

    ” wake up at 3 or 4. I’m usually in the classroom by 6:30 or 7:00…in bed by 9. Habit. Teachers are brain dead by the end of the day.”

    I was raised by two teachers, so I know the routine well. My mother used to be up at 4am every day as well.

    I don’t get up until 6 as a general rule. I can’t imagine getting up at 4. Or 3. On the other hand I’m not in bed by 9 very often.

  28. Cindy says:

    (30) Bob – I teach second graders. The word “pundit” doesn’t come up much but Goldilocks does….

    I’ll try tossing it out there this year in a vocab lesson instead of saying “expert.”

  29. John says:

    Bank stocks will rally more than BDs. They all moaned when the Fed forced them to reaised capital via convts and pref and common stock, but the market is sick of things that promise 10% interest then immediately decline 30%. Merrill etc. will be forced to fire sale assets or deal with the Saudis at gun point. That will make their recovery a longer one.

  30. Cindy says:

    Finished with “Trillion Dollar Meltdown.”
    Bob, I saw you mentioned “Demise of the Dollar” Addison Wiggin. Anything else?

  31. me@work says:

    …#16 – darn, ya beat me to it!!

    Wanna go tonight. Can’t. Waaaaah.


  32. BC Bob says:

    Cindy [34],


    Beware, a good part of it is very technical, a little boring.

  33. grim says:

    I admit, I had to push myself to finish Empire of Debt.

    I hear Mark Zandi has a new book out, Financial Shock.

    I wonder if he would be interested in doing a blog Q&A.

  34. grim says:

    (Zandi is Chief Economist at Moody’s Economy.com)

  35. Clotpoll says:

    x (28)-

    Thanks. Been sleeping like a baby. Two days of bogus rally will be gone and forgotten in another session or two…when once again, the banks will begin to circle the drain in unison.

    They should rename Freddie Mac. Dilution Mac? Freddie Krueger?

  36. Clotpoll says:

    Cannot make it tonight. Off to last tournament of the Summer.

    Say hi to the Knob Creek for me. :)

  37. John says:

    Ugly Bond of day.

    LEHMAN BROS HLDGS INC LEHMAN 5.75000% 11/25/2023 CALL
    Basic Analytics
    Price (Ask) 62.493
    Yield to Worst (Ask) 10.751%

  38. #34 – Cindy – Have you read The Road to Serfdom yet? Link goes to a comic-book version, you can get a regular version just about every where.

  39. Cindy says:

    Thanks for the recommendations –
    I can recomment “My Lucky Day” by Keiko Kasza if you are looking for a good children’s book…

  40. Cindy says:

    yes that was recommenD..

  41. 3b says:

    #21 clot: I just do not understand why the market would rally on this news?

    Last week the markets fall because of concern about financials, this week much of that concern is confirmed,and the markets rally.

    Perhaps the idiots truly have taken over the street.

  42. NJGator says:

    Here’s a great sales pitch for a newly listed home in Madison on GSMLS. Makes you wanna go take a look, huh? No pictures either…

    “REM: Must make an appt with tenants 24hour notice.Call realtor as well .Tenants in the process of moving boxes throughout home, please excuse clutter.”

  43. Clotpoll says:

    3b (45)-

    By however much these banks don’t hit the expected writedown numbers in the current quarter, you can bet that they are spring-loaded to detonate in future quarters.

    And, these bombs will be filled with the nails, bolts and shrapnel of cc, student loan and car loan defaults.

  44. spam spam bacon spam says:

    Oh wait, this one’s better

    The description is Priceless.

    “Title: Kitchen
    Description: A room with a View”

    Emphasize VIEW.


    Wow. What a ….. view.

  45. spam spam bacon spam says:

    Last post.

    Does anyone know what color theme they were going for, here?


  46. Cindy says:

    If NJ is to eventually follow CA here is the headline of the business section for today…(Fresno Bee)Jacob Adelman Assoc. Press

    “Home prices down nearly one-third”

    “Housing data show the median price of a home in California plummeted 31.5% in June compared with the same month last year as languishing properties began settling for less, a real estate tracking firm said Thursday.”

    “Dataquick Information Systems said the median price for new and resale homes and condos stood at $328,000 last month, down from $479,000 in June of 2007.”

    “The decline is being driven by tightening mortgage markets and a growing willingness by sellers to accept less for their homes, as well as a surge in sales of discounted properties.”

  47. John says:

    Big banks did SOX, FDICIA, Basel II and comply with FED/NYSE/SEC/OCC/OTS requirements. There may be a lot of junk in the trunk but they are more likely to do know what the junk is. Merrill and Lehman don’t know what they have. I substaniated the balance sheet at chase a few years ago when I did audit, I also tried to do it at Merrill, damm those TBA mtgs tracing back to box of crap whole loans bought by the likes of american home mortgage, it is poor crap. Jaime knows he has crap like jumbos in califorinia. Merrill has a cracker jack box approach they don’t know what supports the balance sheets on that crap stuff. JT is cleaning house over their but it is a lot easier when a loan was labeled high risk at the get go and defaults then having loans labeled low risk that are actually high risk.

  48. kettle1 says:

    hey grim,

    can you add a “suggested reading” list to the side bar on your main page? there have been a lot of good reading suggestions and i know that i have missed a bunch of them. I am sure that other son here might be interested in some educational reading

  49. x-underwriter says:

    Clotpoll Says:
    They should rename Freddie Mac. Dilution Mac? Freddie Krueger?
    Raines got canned in 2004 from Fannie for cooking the books to make eps targets.
    I guess now they’re doing the opposite. $1.00 loss per share I guess is better than $5.00

  50. SG says:

    Corzine signs affordable housing overhaul

    MOUNT LAUREL — In a scene reminiscent of a Southern Baptist tent revival, Gov. Jon S. Corzine signed legislation on Thursday overhauling the state’s affordable housing policy that advocates called landmark and critics called another property tax raiser.

    The legislation most notably bans regional contribution agreements, or RCAs, the process in which richer towns can sell off their affordable housing obligations to poorer ones.

    “It concentrates the poor in the most impoverished cities, locking them into enclaves of disadvantage,” said Bishop Joseph Galante of the Diocese of Camden. “Out of sight and out of mind with jobs and opportunity out of reach.”

  51. SG says:

    Feds Probe Union Leader and Former Girlfriend of Gov. Corzine

    Investigators Looking at Allegations that Carla Katz Misused Union Funds

  52. bairen says:

    #48-50 spam

    When bad taste happens to good people.

    I wonder if the people in #50 have pets with reflux. That fabric would be great at hiding vomit stains.

  53. Secondary Market says:

    Nom / NJP,

    I’m going to do my best to come tonight. I’m on the Bolt Bus from Philly headed to NYC. Great deal, clean new buses with TVs and WIFI for just $10! Its only 1 buck if you book 2 weeks in advance.

  54. mark says:

    poor carla.. jon to pay legal??

  55. SG says:

    Bay Area home prices plunge 27% in last year

    That is much larger percentage drop than what I had imagined. Next up NJ.

  56. DL says:

    #58. Read about Bolt Bus. $1 Philly-NY? Is it crowded? Took a Gray Hound once and between the smell of urine and the panhandlers, vowed never to ride the bus again.

  57. BC Bob says:

    “Contact Your Senator: Say No To Fannie Bailout”

    “Bernanke told lawmakers it’s ‘important’ for Fannie Mae and Freddie Mac bonds and stocks to rise…Paulson said the two companies are ‘essential’ because they represent the only “functioning” part of the home loan market.”

    “Want to know who’s being bailed out by the Paulson and Bernanke’s proposal? Here is the answer: China and PIMCO’s Bill Gross.”


  58. bairen says:

    #60 SG

    Another year like that and I could afford to live in the Bay area.

  59. SG says:

    Rutgers Economist Sees Two More Years of New Jersey Job Losses

    Jul. 17–New Jersey is in a mild recession and will continue to shed jobs into early 2010, a Rutgers economist said Wednesday.

    Nancy Mantell, director of the Rutgers Economic Advisory Service who spoke at the organization’s summer conference in New Brunswick, predicted that over the next two years the Garden State will lose 31,000 jobs from its employment peak of 4.08 million in the fourth quarter of 2007.

    If she is right, that will be a smaller number of job losses than in the previous two recessions. The state has lost 14,100 jobs this year.

    “It’s no longer a question of whether New Jersey is entering a downturn. We’re there,” said Philip Kirschner, president of the New Jersey Business and Industry Association. “Any hope of a comeback in private-sector job growth this year has just about vanished with this report.”

  60. Cirrus says:

    Finally a GTG in our neck of the woods :)

    See you guys and gals at 5:30. I believe my better half will also allow me to accompany her to this little shindig.

  61. BC Bob says:

    “Affluent areas such as Marin County and San Francisco, which until now had resisted most price erosion, saw existing single-family home median prices fall by about 11 percent.”

    From SG[60],

    Another location that was immune, according to Pret.

  62. rhymingrealtor says:

    * Off topic*

    Can anyone suggest a way to get vhs on to dvd ( an easy way please) From what I am googling a combo vhs /dvd player should do it however the reviews on all the models I find are mixed, from works like a charm to too complicated.


  63. Nom Deplume says:

    [4] NJP

    “It’s going to be a long day. I need a drink.”

    Patience, mon frere, patience.

  64. Nom Deplume says:

    [61] DL

    Not to scare anyone, but I am not a big fan of intercity buses, especially low cost operators.

    I drove a bus in college and I know how the intercity drivers drive and why (at Peter Pan, drivers were paid by the mile, creating an incentive to speed). Also, MCIs and Prevosts handle pretty well for something so large, and that fosters false security in the driver.
    Not surprisingly, they have an extremely high accident rate, and NJ seems to be the epicenter of bus accidents.

  65. bairen says:

    “Voters to decide on naming sewage plant for Bush”


    Wonder what they’ll name after the VP?

  66. x-underwriter says:

    SG Says:
    Something Big is Happening

    Great speech. Unfortunately rhetoric like that, however true, gets as much consideration as a homeless looking guy standing on a milk crate shouting with a bible at the corner.

    American’s are too comfortable in their false sense of security to give a shit about the big picture….most politicians included.

  67. NJGator says:

    George W. Bush Sewage Plant plan is on ballot
    Friday, July 18, 2008

    (07-17) 14:57 PDT SAN FRANCISCO — San Francisco voters will be asked to decide whether to name a city sewage plant in honor of President Bush, after a satiric measure qualified for the November ballot Thursday.


  68. Secondary Market says:


    Its very clean and only about 10 of us on board. A few students and euro travlers. I believe bolt is a part of grayhound and only does DC,Philly and NYC.
    I’m sitting up front and the driver is cautiously doing 60. Its not bad but I am taking Amtrak back to avoid shore traffic.

  69. stan says:

    Hoboken numbers.

    look reliable and I double checked on the nj tax records site. Those that have gone thru the county clerks office were accurate.


  70. Clotpoll says:

    spam (50)-

    Is Rohrschach a color?

  71. Clotpoll says:

    SG (55)-

    “It concentrates the poor in the most impoverished cities, locking them into enclaves of disadvantage,” said Bishop Joseph Galante of the Diocese of Camden. “Out of sight and out of mind with jobs and opportunity out of reach.”

    Much better to put them out in Hunterdon or Warren Co…nowhere near public transportation, shopping or jobs.

    Yeah, that’s the ticket.

  72. 3b says:

    #64 Sounds too optimistic to me.

  73. Clotpoll says:

    SG (56)-

    I get a sorta creepy, crawly feeling when I see the words “Carla Katz” and “probe” used in the same sentence.

    Just saying.

  74. skep-tic says:



  75. Tom says:

    When do you guys think we’ll start hearing about the problems in the non-consumer credit markets?

    A bunch of projects have stalled due to lack of financing. With the projects left unfinished I can’t imagine they’ll be able to keep up payments. Commercial REITs have already taken a beating.

  76. Rich In NNJ says:

    Cresskill Comp Killer!

    SOLD: 223 MADISON AVE $545,000 7/14/2004

    MLS#: 2801370
    Orig. List: $649,500 12/12/2006
    SOLD: $525,000 7/17/2008

  77. Victorian says:

    81- I agree.

    When can we get our very own Dubya Sewage plant??

  78. Rich In NNJ says:

    Closter FUTURE Comp Killer!

    SOLD: 15 GARRY RD $1,350,000 8/2/2006

    MLS#: 2830189 (REO)
    Orig. List: $1,600,000 1/30/2007
    Last List: $1,175,500 7/17/2008

  79. Rich In NNJ says:

    Dumont FUTURE Comp Killer!

    SOLD: 77 VAN RIPER AVE $392,000 7/25/2005

    MLS#: 2830124 (REO)
    Orig. Lsit: $449,900 2/13/2006
    Last List: $335,000 7/17/2008

  80. Rich In NNJ says:

    Ooops, last one was Elmwood Park, not Dumont!

  81. Rich In NNJ says:

    Fair Lawn FUTURE Comp Killer!

    SOLD: 15-03 LUCENA DR $610,000 7/19/2004

    MLS#: 2830280
    Orig. & Last List: $501,900 7/17/2008

  82. bairen says:

    #84 Victoria

    “When can we get our very own Dubya Sewage plant??”

    We could install it right next door to the NJ Government Hall of Ethics and Common Sense

  83. kettle1 says:

    any suggestions on parking if i take the clifton station in for the GTG?

  84. Rich In NNJ says:

    Ho-Ho-Kus FUTURE Comp Killer!

    SOLD: 183 LAKEWOOD AVE $790,000 4/4/2006

    MLS#: 2820100
    Orig. List: $779,000 5/15/2008
    Last List: $729,000 7/17/2008

  85. Tom says:


    I heard a rumor that agents are listing homes much lower than boom prices and lower than last sale to get the free advertising from your comp killer posts. They’re hoping to get a bidding war going from the people that read this blog.

    (By “heard” I mean “just made up”) :)

  86. Rich In NNJ says:

    Old Tappan FUTURE Comp Killer!

    SOLD: 6 OLD CHURCH CT $1,374,000 7/10/2006

    MLS#: 2823607
    Orig. List: $1,298,777 6/10/2008
    Last List: $1,198,777 7/17/2008

  87. grim says:

    any suggestions on parking if i take the clifton station in for the GTG?

    You should be able to find parking at the station.

    What train? I may be on it.

  88. kettle1 says:

    Clot 78,

    So the only reason these people may be in a lower socioeconomic segment of the population is because of where they live????. To be somewhat bombastic, may i suggest that we consider west virginia? if rural is better then urban, why not just build housing in west Virginia for these individuals?

    housing is not the root problem and it is not the solution. To socioeconomic status anyway.

  89. Rich In NNJ says:

    Upper Saddle River FUTURE Comp Killer!

    SOLD: 312 LAKE ST $662,500 3/11/2005

    MLS#: 2824472
    Orig. List: $825,000 3/26/2007
    Last List: $659,000 7/17/2008

  90. HEHEHE says:

    Considering this GTG is three blocks away from work I might have to attend

  91. kettle1 says:

    either 430pm or 5pm, depending on how long it takes to get to clifton from mahwah

  92. HEHEHE says:

    ““First of all, I take exception to the ‘you guys’ comment. I did not create these C.D.O.’s.””


    Apparently John Thain will take the big CEO paychecks but don’t give him any blame.

  93. HEHEHE says:

    FBI investigates IndyMac


    Fraud puh-leeze! I am sure the Indymac CEO is wishing he had thought of those Capital Hill lending programs Mozillo came up with right about now.

  94. Rich In NNJ says:

    Kettle (98),

    Why not just take the train from Ramsey station on route 17?

    Unless you work in Mahwah and in live in Clifton.

  95. Tom says:

    “First of all, I take exception to the ‘you guys’ comment. I did not create these C.D.O.’s.”

    Apparently John Thain will take the big CEO paychecks but don’t give him any blame.”

    Isn’t this exactly why Sarbox was enacted? So that executives would not be able to shirk responsibility like this? That’s why so much work and money went into upgrading systems to insure there was no tampering and that nearly every penny could be traced.

    Please start throwing these crooks in jail.

  96. HEHEHE says:


    A little light reading for the train ride:

    Rand: Iran’s Political, Demographic, and Economic Vulnerabilities


  97. kettle1 says:

    i live in rockaway and work in mahwah. It would take me 2+ hours to get home from NYC if i have to take the train back to mahwah and then drive home. Its shorter for me to get home by taking the train back to clifton then driving home.

  98. grim says:


    Let me know if you want to meet up in Clifton.

  99. kettle1 says:

    would the 5pm train work for you grim?

  100. bairen says:

    “Top fund managers socked by financial bets”


    Bill Miller down 41% this year.

    Was he lucky for 15 years and is regressing to the mean?

  101. Rich In NNJ says:

    Rockaway to Mahwah everyday!

    I’m guessing you take a bicycle you know, to save the environment.

    Ever think of moving?

  102. spam spam bacon spam says:


    There is no accountability.


    We are all professsional slackers when the schitt hits the fan:

    “I didn’t know”.

    “I wasn’t there”.

    “Noone told me”.

    “It wasn’t like that when I left”.

    To be in my own business, one of the first, and hardest lessons I had to learn was saying,

    “Oh, I screwed up. Let me correct this right away”.

    and this lesson? I’m still learning it. It’s not a natural reflex. I literally have to remind myself often.

  103. Nom Deplume says:


    No doubt sponsored by Jello Biafra, frontman for the Dead Kennedys.

    Seriously, how long until someplace in Texas remains a landfill for Pelosi?

  104. Nom Deplume says:

    [80] Clot and SG

    that was a visual I didn’t need.

  105. kettle1 says:

    rich 108

    no, i am an indpendent contract and my work is in a different location on a regular basis. some days i am in mahwah, other i am in elizabeth etc….

  106. Rich In NNJ says:

    Ahhhh, I see.

    Gonna be in Mahwah long? It would be great to get a Bergen County GTG together.

  107. kettle1 says:


    probably until dec

  108. 3b says:

    #113 Rich: How about the Iron Horse?

  109. HEHEHE says:

    As a single who lives in Hoboken let me say, HAHAHAHA! That’s some funny sh*t.

  110. Doyle says:


    Newark and East Orange also made that list… now I’m frightened. Yeah, I always think of Hermosa Beach and East Orange as being very similar.

  111. HEHEHE says:

    Don’t get me wrong Hoboken is nice, but nicest place in America? Not quite.

  112. Doyle says:


    You should watch the video clip. They follow a guy around Hoboken, and interview your Mayor in his office.

  113. Doyle says:


    Exactly my thoughts. I lived in Boken for 4 years (and liked it), but I tend to think Hermosa Beach is a slightly better scene.

  114. skep-tic says:


    July 13, 2008
    The Prescient Are Few


  115. HEHEHE says:


    No offense but that worthless, lying, closeted homosexual, sack of sh*t is not my mayor!!! :)

  116. RentinginNJ says:


    Rockaway is on my very short list of places to buy. We are activly looking there now.

    How do you like it? Anywhere I should stay away from?

    Also, the taxes do seem high there when compared with the surrounding towns. Any thoughts on that? Should I be worried?

  117. 3b says:

    #124 rent:Should I be worried?

    Whereever you buy in NH, you should be worried about taxes;very worried.

  118. 3b says:

    #125Sorry should be NJ, not NH

  119. RentinginNJ says:

    Whereever you buy in NH, you should be worried about taxes;very worried.

    Thats a given. I mean, “should I be more worried than I would normally be buying in any other NJ town with slightly less stupid property taxes”

  120. skep-tic says:

    from the WSJ… amazing

    Countrywide Filing Shines Light on Loans
    July 18, 2008; Page A14

    An amended complaint filed Thursday by the California attorney general related to a suit against Countrywide Financial Corp. sheds new light on the poor quality of loans the company was planning to sell to investors.

    The new data provide a close look at 158,000 mortgages that had been slated for sale by Countrywide Homes Loans before last summer’s credit crunch — which was triggered by rising mortgage defaults — turned investors away from mortgage-backed securities. Nearly 48% of nonprime loans and 21% of pay-option adjustable-rate mortgage in that portfolio were in some stage of delinquency or foreclosure as of April 30, according to the amended complaint, filed by California Attorney General Jerry Brown in state court in Los Angeles. Overall, more than 21% of all loans in that portfolio were in some stage of delinquency or foreclosure, it says.

    These loans account for roughly 17% of mortgages held by Countrywide, says Dan Frahm, a spokesman for Bank of America Corp., which completed its acquisition of Countrywide earlier this month. Mr. Frahm added that 9.53% of all loans owned by Countrywide were 30 days or more past due as of the end of April.

  121. kettle1 says:


    Rockaway is nice enough,

    The primary things to be aware of are1. Dover. While its certainly not newark, i dont know that you want to raise a family in close proximity. Dover is currently having the same issues that many towns with a high percentage of legal/illegal immigrants live. ( not trying to start that debate)

    2. I will double check this weekend, but one of the elementary schools is known to be terrible! I will get back to you on that one, my wife will know.

    3. taxes…. I dont pay much attention as i am a poor dirty renter. I do know that the local paper has been talking about budget issues.

    There are some very nice parts of rockaway. One possible pitfall is that as the economy drops off, the ton could lose a lot of income coming from the rockaway mall, as shopping drops off. No reason to take the town off your list, just FYI

  122. kettle1 says:


    will i see you on the 5pm train out of clifton?

  123. grim says:

    I might head out a bit earlier

  124. njpatient says:

    all read jj at 52

  125. njpatient says:

    “can you add a “suggested reading” list to the side bar on your main page? there have been a lot of good reading suggestions and i know that i have missed a bunch of them. I am sure that other son here might be interested in some educational reading”

    grim – good idea from kettle. I think you can add a direct link to Amazon that pays you an amount if people buy the book directly through the link (without increasing the price to the buyer).

  126. kettle1 says:

    No need to worry about gas prices!!!!

    Just provide government funded liposuction for all americans and then use the fat to make biodiesel!!!!

    US population is 300 million, 1/4 is 75 million.
    assume we can get 10 lbs/person minimum = 750 million lbs of fat

    SG(specific gravity) of human fat is about 0.9 and fat based biodiesel can give 1 gallon of biodiesel per gallon of fat. So right there we have 750*.9 = 675 million gallons of biodiesel.

    This would replace about 1.6% of the total US diesel consumption (40 billion gal/yr), not much but a start. AND!!!! its renewable. just keep eating those Twinkies and fries and every year the GOV can harvest another 10 pounds from you! Talk about recycling

    More than a quarter of all Americans are now obese, the latest U.S. government figures show

  127. bairen says:

    This bubble is reminding me more and more of a comic book. Plenty of villians, lots of huddled masses, corruption and double talk, yada yada yada.

    So in that spirit I’m thinking about giving myself a superhero like handle.
    I’m considering

    Heloc Hero
    Ponzi Popper
    The Loan Ranger

    Perhaps something even better will come to mind.

  128. kettle1 says:


    Underwater warrior?
    Capt Inflation?

    as for a jester…. Bernanke the Bungler?

  129. njpatient says:

    82 Tom

    “When do you guys think we’ll start hearing about the problems in the non-consumer credit markets?”

    There’s been a problem financing M&A for a year already.

  130. x-underwriter says:

    Doyle Says:

    Hoboken voted #1 in the country as best place for singles to live.

    Newark is #20 in the country…is you crazy!!!!!

  131. Tom says:


    I know there have been problems, I guess I meant when is it going to hit the main stream media the way the residential market has or will it ever?

    As an aside, this is old news but I only recently found it and thought it was funny. My apologies if it’s been posted before.

    But if you’re a single woman here’s a great way to get out of housing trouble in a way that lets you have your cake and eat it too. Looking to live the american dream? Get a jump start with buying this home, wife and kids included. (Money not included)

  132. kettle1 says:


    i can see newark at 20. Last i heard the “night life” was still hopping, as ladies of the night are readily available!
    Any comments on this John? a story perhaps?

  133. njpatient says:

    139 Tom

    “or will it ever?”

    I wonder. It has to come with the admission that the entire economic system in this country is broken, and folks have a hard time admitting that. It’s easy to say “those financially inept folks over there screwed up this subprime thing – oh well, let’s move on.” Different to say that the very basics have come unglued.

  134. bairen says:

    #136 kettle1


    Major Meltdown
    Freddie Smack
    Captain Corruption

    Some great names like Flipper, Pop goes the weasel and Helicopter Ben have already been claimed.

  135. 3b says:

    #141 njpatient:Different to say that the very basics have come unglued.

    And to admit that so many people played a role in it, as opposed to saying it is just Wall St’s fault, or the realtor’s fault, or the mtg broker’s fault.

  136. Arr Elle says:

    #138- Live in Newark only because I bought a cheap co-op and yes I’m single. Just wondering what is so desirable about Newark besides the ruthless killings?

  137. x-underwriter says:

    Rockaway ain’t bad if you go north of the town towards Green Pond. Watch the taxes though. The NJ.com site that shows taxes for all the towns lists Rockaway as one of the worst in Morris County. I’d shop in Denville before I went there as it’s a little better taxwise and doesn’t butt up to Dover-rico

  138. njpatient says:

    143 3B


  139. Tom says:


    first step is to admit we have a problem, because pretending we don’t and trying to find a booming market segment to exploit has just done more harm than good.


    I think some people will find your suggestion completely immoral even if it was meant to be humorous. First of all, the only people going to benefit from it will be the plastic surgeons, divorce lawyers and youtube and myspace after all the “check out my new sexy body” videos come out. Secondly, the chubby chaser lobby will never allow it. Even though Bubba is out of office he still has a lot of sway.

  140. x-underwriter says:

    I think Bi is the number cruncher for Money.com’s best places lists.
    Any time I read one of them, it’s totally baseless

  141. Doyle says:



    None taken!

  142. njpatient says:

    “first step is to admit we have a problem”

    I rely on grim to make that happen.

  143. njpatient says:

    Tom – I think kettle’s Swiftian solution may work. And I don’t think it discriminates against fat folk (and I ain’t skinny), because they’re the folks who’ll be able to generate their own power. When we run out of oil, the obese will rule the world!

  144. Tom says:


    It has to be sustainable, we don’t want to get in the same situation we have with respect to the lumber industry or going further back to what happened with whales. I think the comparisons are clear.

    Plus I don’t think the BBW pron industry, which has been growing in recent years (even though it has somehow lost speed it has maintained momentum) will be too thrilled.

    If we could restrain the industry to stick to 10lbs of winter fat I’d be ok with that. I’d even sign up but I think there will be abuse.

  145. BC Bob says:

    “As recently as February of this year, Russian officials cleared the way for two of its sovereign wealth funds, the Reserve Fund and National Wellbeing Fund, to invest in various foreign bonds, including those issued by the twin towers of American residential finance, Fannie and Freddie.”

    “The prospect for every GSE bond clearly states that it is not backed by the United States government,” says Matt Kibbe, president of FreedomWorks. “That’s why investors holding agency bonds already receive a significant risk premium over Treasuries.”

    “The Russians ignored the warnings and grabbed the risk premium. Today, fully 21% of Russia’s monetary reserves are invested in the obligations of Fannie, Freddie and the Home Loan Banks. And the largest holder of Fannie and Freddie debt is another friendly foreigner, China. The middle kingdom, according to the FreedomWorks organization, owns $376 billion worth of U.S. agency bonds. Altogether, foreigners hold $1.3 trillion of them.”

    “In the case at hand, by the year 2007, the CEOs of Fannie and Freddie were earning salaries that would have been respectable, even on Wall Street. Fannie’s main man, Daniel Mudd took home $13.4 million in 2007, a year in which the firm lost $2.1 billion. While the Freddie Kruger of mortgage finance, Dick Syron, pocketed $18.3 for helping Freddie Mac to a $3 billion loss and a 33% trim for the shareholders.”

    “As recently as May of this year, Mr. Mudd told the New York Times that he was “seeing the best opportunities since I’ve been in this business.” Two months later, both Fannie and Freddie are “insolvent,” says former Fed governor William Poole.”


  146. skep-tic says:

    actually, until maybe a week ago, the very basics of our economy had not come unglued yet. the market was correctly rapidly (mostly still is), which is what should happen. people who made dumb decisions were losing. they still mostly are, but now the feds are trying their hardest to prevent it on both ends (by bailing out the lenders and borrowers)

  147. Rich In NNJ says:

    Kettle (114),


    3B (115),

    The Iron Horse: Haven’t been to the bar but I was in the restaurant about 2-3 years ago and my first thought was wow, it looks just like it did in the late 70’s. On closer inspection I realized even the ketchup stains on the walls were from the same period as well.
    In Westwood I prefer Finnegan’s though the bar is small and all the spots are usually taken by the locals.

    It’s not central but Brady’s (formerly Trackside) in Ramsey has two bars so I’m sure we could easily commandeer a section of bar. And as its old name states it is right next to the tracks (Bergen/Main Line), diagonally across from the downtown Ramsey train station.

  148. 3b says:

    #155 That would work. I suggested the Iron Horse, ebcasue of that room they have in the back, but Brady’s sounds good.

  149. chicagofinance says:

    NJ Starbucks closures






  150. Sean says:

    re: #113 Ironhorse in Westwood, had what passed as food there a year ago while, you will need an iron stomach.

  151. njpatient says:

    154 skep

    “people who made dumb decisions were losing.”

    I would dispute that. We’ve so far spent a couple hundred billion in bailouts.

  152. 3b says:

    #157 chgofinance:13499 RIDGEW00D 10 WILSEY SQUARE RIDGEWOOD

    OMG!!! Ridgewood!!!

  153. kettle1 says:


    I am still waiting to hear when i can take my dirty laundry to the FED window……

  154. 3b says:

    #158 Sean:I have not eaten there in years, but at one time the food was decent.

  155. kettle1 says:

    grim are you taking the 4:30 train?

  156. chicagofinance says:

    From yesterday posted by the GPS. It is one of the most ugly, disgusting and ignorant posts I’ve ever seen on this blog from someone who ostensibly should know better and claims a moral highground…..

    Tom Says:
    July 17th, 2008 at 8:56 pm
    The IT folks, admin, hr staff, etc will have an easier time moving into other market segments. Those in the finance side won’t have as many options.

    The banks needed to hire more people to handle the volume they were generating. You can’t tell me their all financial wizards. Those people were lucky for the boom to be able to be making the money they were making.

    Those that know what they were doing should have an easier time moving on.

    It wasn’t just a handful of people screwing up. The losses are projected to be in the trillions. We’ve already seen losses in the billions. The whole country has been affected. There have already been indictments and there are ongoing FBI investigations. What happened wasn’t just stupidity, it was criminal in many cases and hopefully the biggest offenders get brought to trial and not just some of these token small fish.

    I’m sure the people are good people, but I don’t really have much sympathy if they lose their jobs. There are millions of people that will suffer loses that weren’t making money off the companies that caused this mess and weren’t defaulting on loans after cashing out hundreds of K in equity.

    Someone should really take a much closer look at what’s happening on wall street. Two huge bubbles so close together just isn’t right.

  157. 3b says:

    #161 kettle:I have an old lawn mower, patio furniture, and a Members Only jacket from the 80’s. Can I bring that to the Fed window too??

  158. grim says:


    Earlier, 3:55, I’m trying to catch up with someone before they leave.

  159. Hobokenite says:

    stan Says:
    July 18th, 2008 at 10:13 am

    Hoboken numbers.

    Those 1BR #’s (Avg. Sold Price) are just ugly.

  160. kettle1 says:

    i’ll be on the 4:30, walking out the door now!

    hey, i might even wait 20 minutes before predicting the end of the world!

  161. skep-tic says:

    “We’ve so far spent a couple hundred billion in bailouts.”

    OK, fair enough. It just seemed to move up to the next level in a big way last week. No more surreptitious bailouts.

  162. House Hunter says:

    …. a note on the summer shore season. We just got back from a week at Cape May. Vacancies at every hotel. We have never seen that in the last 4 years we have been vacationing there. Food definitely up, but I guess we knew that.

  163. Rich In NNJ says:

    Earlier, 3:55, I’m trying to catch up with someone before they leave.

    Relax, your friend Johnnie Walker will be there no matter what time you arrive.

  164. Hobocondo says:

    There’s a Hoboken condo on the market for $709,000 (1150 square feet). Owners originally purchased it in 2000 for $393,000.

    That’s just insane.

  165. Hobocondo says:

    I should say that the condo is in the Constitution building which is decent, but not among the top buildings. Unit does not face water.

  166. njpatient says:

    169 skep


  167. grim says:

    Why so quiet today?

  168. Doyle says:


    John has a summer friday.

  169. Looking says:

    My bother just got laid of at WaMu.

  170. njpatient says:

    sorry, Looking

  171. njpatient says:

    “Why so quiet today?”

    too much to do

  172. Tom says:


    Don’t take this the wrong way, but I think you need to expand your understanding of what happened with the housing boom. Thinking in terms of just borrowers and lenders doesn’t cover even half the story. Credit rating agencies, wall st, brokers, insurers all had a hand in what happened. The trading of subprime mortgage based securities was a big part of it. Credit rating agencies didn’t do a good job assessing the risk of these securities or didn’t care because the FRBNY had already shown it would jump in with billions of dollars in the late 90’s if they think it would prevent larger problems in the financial markets.

    It’s one big mess.

  173. Looking says:

    WaMu just gave him a box, and told him to pack up. Of course the other manager watched as he packed, and escorted him out of the branch. That was it. 2 years and not even a Thank You.

  174. Cindy says:

    (180) Tom said..

    skep-tic “Don’t take this the wrong way, but I think you need to expand your understanding of what happened with the housing boom.”

    Tom, skep-tic may or may not feel like expanding what he/she has to SAY about the housing boom but skep-tic does not need to expand his/her UNDERSTANDING about it….

    (Sorry skep-tic – I have no idea what you do or if you are a he/she.)But I do know you have a complete understanding of this “one big mess.”

  175. John says:

    Not quiet just bs’ing at Ulysis as my brother had interviews downtown and I met up with him afterwords. My late lunch became three or four pints of guiness and the scenenery was quite nice. Funniest thing was my brother ordered a tall in a grande cup no milk. They charged him for the tall yet filled it to the same point as my grande with milk. Dang being unemployed gives you some tricks of the trade, I am so jealous.

  176. John says:

    Not a bad send off. At least he got to put his stuff in the box. We used to throw the employee out out and UPS them the stuff in a box. God the freeky stuffy these guys kept in the desk. Vasoline with pubs sticking out I once UPS’d dang that was funky.

  177. r says:

    South Constitution 2 bedrooms in Hoboken are now selling for under $700k regardless of where they are listed. The ones listed north of $700K are sitting for months. The top of the market for the South Constitution was in 2005 when a few two bedrooms traded for $800K plus.

  178. John says:

    BTW SOV MAY BEAT THE STREET. Don’t know but saw a crazy price tick up in the two prefs in last 60 minutes.

  179. Victorian says:

    184 – John.

    “Vasoline with pubs sticking out I once UPS’d dang that was funky.”

    Ahhhh…. now the day feels complete.

  180. Sybarite101 X says:


    Are you coming???

  181. Victorian says:

    “Citigroup lifted the Dow Jones Industrial Average to the steepest three-day gain since March 2003”

    – cant make this up.

  182. 3b says:

    #189 Victorian: Minor rally in a Bear market, IMO.

    The economic and market fundamentals are still dismal,and investors are deluding themselves.

  183. njpatient says:


    “Sorry skep-tic – I have no idea what you do or if you are a he/she”

    I think skep’s a lawyer and have always assumed s/he’s a dude, but I may be wrong about that.

  184. Tom says:


    Amazing isn’t it? Their sales are down 33% from last year and instead of billions in profits they have billions in losses.

    But the stock gets a bump because they’re huge loss wasn’t as huge as analysts expected.

    All we need is for analysts to keep being pessimistic and the market should improve :)

  185. Cindy says:

    (191) Thanks nj…I thought YOU were the lawyer…

    Anyway, skep-tic has been very helpful and informative and is quite aware how we got here…A man of few words, though – to the point and all that.

  186. Mikeinwaiting says:

    3b 190 Sucker rally, they will give it all back in the long run as it hits the fan. The lower price in oil reflects the assumption that the economies of the world are headed down. So the market goes up?
    This is bad news for the market & they don’t see it?

  187. njpatient says:

    180 Tom

    I think most of the crew here views the bubble as being a massive free-for-all with villains of every flavor.

    There were almost no innocents, at least IMO.

    And to reiterate a point that Chifi made earlier, many of the folks getting canned at the $ institutions had nothing to do with it.

    I’m the happiest guy in the world when the villains get left holding the bag (you can call me schadenfreude-boy if you like) but I don’t define the villains narrowly.

    I don’t find any more sympathy for the folks who took the loans than for the folks who gave the loans, nor for the pimps at the NAR and their thousands of flying monkeys, nor the pimps in the media, nor the policy maroons at the fed and in the Bush and Clinton administrations.

    The occasional troll on hear often tosses out accusations of bitterness, and let me tell you that I, for one, am happy to cop to that feeling.

    The bubble has been a giant PITA from the Patient perspective, and I don’t mind if every single damn fool who caused it winds up drinking a little metaphorical hemlock.

  188. BC Bob says:

    “Fannie Mae and Freddie Mac. End of illusions”


  189. njpatient says:

    …nor the folks who packaged and sold the loans, nor the folks who invested in the packaged loans, nor the…

  190. Laughing all the way says:

    Hoboken voted #1 in the country as best place for singles to live.

    that is an absolute joke. the problem with these damn lists is that i guarantee you one of the editors of CNN’s Money section lives in Hoboken and thinks it is awesome.

    It’s another reason why NY Magazine has been on Brooklyn’s tip for the last few years. All the low-paying editor jobs at that mag have forced the staffers to live in Brooklyn, and they think it’s cool.

    Not being a snob, but there’s no way NY isn’t the best place to live for singles in the US. No way.

  191. movinB says:

    Greetings again from the Bay Area. Anybody have thoughts on commuting from Bergen County to a job in Brooklyn?

    We’re still hoping to make the move to BC (where I grew up) this year, and my husband seems to be finding lots of jobs posted in the Brooklyn area.

    My initial reaction is that it would be much more of a pain than commuting to Manhattan (where I’ll be working), but he seems to think it’s just a few more subway stops and not a big time difference.

    Also, I feel like if he’s working in Bklyn, and I’m working in Manhattan, Bklyn or LI would make more sense for where we’d live.

    TIA for your feedback! Hope everyone has fun @ the GTG… and best wishes to you, Grim.

  192. SG says:

    L-ish Economic Prospects


    Home prices are in free fall. Unemployment is rising. Consumer confidence is plumbing depths not seen since 1980. When will it all end?

    The answer is, probably not until 2010 or later. Barack Obama, take notice.

    It’s true that some prognosticators still expect a “V-shaped” recovery in which the economy springs back rapidly from its slump. On this view, any day now it will be morning in America.

    But if the experience of the last 20 years is any guide, the prospect for the economy isn’t V-shaped, it’s L-ish: rather than springing back, we’ll have a prolonged period of flat or at best slowly improving performance.

  193. HEHEHE says:

    The rally’s the past couple of days is just the PPT at work. Come out and talk up the market. Buy up some targeted shares with taxpayers money. Squeeze the shorts for a few more points. Then watch it all drop back down again for a month until you start all over again.

  194. Cirrus says:

    am I the first one here?

  195. SG says:

    Have fun at GTG. Can not attend today due to prior commitments.

  196. Pat says:

    No, I was here first, in spirit.

  197. grim says:

    Where the hell is this joint?

  198. Cirrus says:

    it’s lonely here being the only bitter renter. I assune all these 20/30 somethings all make mid six figures and own their own NYC penthouse condos…

    sittin at the corner of the bar enjoying some summer ale if anybody cares to join me!

  199. Cirrus says:

    51st between 5th and 6th (Ave of Americas)

  200. morpheus says:

    Njpatient at #195:

    No, really tell us how you fee1! (Sarcasm off). I hope never to piss you off!

  201. njpatient says:

    “the problem with these damn lists is that i guarantee you one of the editors of CNN’s Money section lives in Hoboken and thinks it is awesome.It’s another reason why NY Magazine has been on Brooklyn’s tip for the last few years. All the low-paying editor jobs at that mag have forced the staffers to live in Brooklyn, and they think it’s cool.”

    The media can’t distinguish between data and anecdata.

  202. njpatient says:

    199 movin

    “My initial reaction is that it would be much more of a pain than commuting to Manhattan (where I’ll be working), but he seems to think it’s just a few more subway stops and not a big time difference.”

    You’re right, he’s wrong. Commuting to bklyn from manhattan is enough of a pain. Get him to take the actual commute next time he has a Monday off – he’ll change his tune.

  203. Tom says:


    I didn’t mean to imply that skeptic didn’t know what he was talking about. Almost from the first time I started posting here we’ve had a few exchanges that I at least considered to be interesting and productive. We seem to agree on most things except he seems to put more of the blame on borrowers. I was just looking to continue or debate. I don’t know that I said anything that would offend him or at least I didn’t mean to and if I did I apologize.

    I tend to debate more about the issues where I disagree with someone because that’s where I find it more interesting and learn the most.

    The point I was trying to make regards to the employees is that companies were hiring during the boom and a lot of these people wouldn’t have had those jobs making the money they were making if it wasn’t for the boom. It sucks that they’re getting let go but they should be happy they got what they did in some cases.

    I have more first hand experience with the dot com bubble and I can tell you there were tons of people that were drawn to the money and didn’t know what they were doing and couldn’t pick it up. Didn’t matter, companies had money to burn and if they didn’t show they could burn through it they might not get the next round of financing. It’s not hard to find news stories of similar things happening in the finance world during the boom, like the busboy turned mortgage broker raking in a 6 figure salary. He might have to go back to the food service industry.

    All these layoffs are going to result in a giant game of musical chairs where hopefully the best find a seat and the rest move on to other fields. I’m not assuming everyone that gets laid off is incompetent or not as good since a lot is based on personal relationships but I can’t swallow that all these people were financial geniuses that are getting a raw deal.

    Like I said, the IT, admin and other support staff are generally better off because they aren’t as limited to finance if they really know what they’re doing.

    I don’t remember every saying I held them responsible I just don’t have much sympathy for them. Especially if as was claimed, they knew what was going on and didn’t prepare for the crash.

    The housing bubble sucked a lot of money from other parts of our economy and once things get straightened out I think we’ll start seeing that money being spread around more like it was before.

    People are going to lose their homes, and/or their jobs. Other areas of the economy are also taking a hit as a result. I just feel that the sooner we get back to normal the sooner we can start rebuilding.

  204. movinB says:

    209 njpatient

    Thanks, I’ll suggest that. Yeah, commuting from BC to Manhattan is enough of a pain, the half-dozen times I’ve done it.

    I think this will logically follow with us having to consider living on that side of the river/island… mehhh

  205. Cindy says:

    (210) Tom

    It’s just that when you say someone “needs to expand their understanding” about something, it comes off as condescending.

    Maybe you can say “I disagree so let me share my ideas….”

    I have found that many here know more than I can ever hope to and you have so many ideas to share. Alas, I am soooo NOT argumentative so I will leave it at that.

  206. skep-tic says:

    “Thinking in terms of just borrowers and lenders doesn’t cover even half the story.”


    I understand all of that, but to me all of those things you mentioned were/are deeply secondary.

  207. Cindy says:

    (213) Hi skep-tic – been talkin about you…

  208. Cindy says:

    And Tom, IMHO Everything comes down to personal responsibility and living well with the choices we make.

    I otta know, I’ve made some doozies but I don’t beat myself up about them or BLAME anyone…you learn and move on.

  209. bairen says:

    #188 # Sybarite101 X Says:
    July 18th, 2008 at 4:49 pm


    Are you coming???”


    Please never ask john if he is “coming”.

    Instead use words like “join” or “attend”.

  210. NJl$rd says:

    Sorry can’t make it because of the busy family schedule here (sound stale). Enjoy your GTG while you still can …

  211. Cindy says:

    With fifth and sixth graders, when you are on recess duty and the bell rings you don’t say “Hold onto your balls.” You say “Hold on to your equipment.”

  212. skep-tic says:

    Tom– I think it is clear that you tend to put more blame on institutions and I put more blame on individuals. At root, I think it is unavoidable that this entire mess is the result of a great number of bad individual decisions.

    Borrowers and mortgage originators in my view deserve primary blame because they were the ones at the ground level of the food chain. There would have been no bogus securitizations, rating agency scams, SIVs etc without there first being a borrower who was willing to borrow beyond his ability to pay and a mortgagor who was willing to essentially help him commit fraud.

    I understand that this is somewhat of a chicken vs the egg phenomenon since none of this would have been possible without the securitization machine.

    However, I would compare it to the trash you see in the media on a daily basis: yes, the tabloids make it available, but they are making it available to service a public that demands the crap. If it doesn’t come from vendor 1, then vendor 2 will spring up and supply the demand.

  213. Tom says:


    “It’s just that when you say someone “needs to expand their understanding” about something, it comes off as condescending.”

    Ah, yeah, that’s not exactly how I wanted that to come out. Sorry about that.

  214. Cindy says:

    Got it..Thanks, Tom.

  215. njpatient says:


    “Where the hell is this joint?”

    I think that’s properly spelled “jernt”.

    Or is that Archie Bunker?

  216. 3b says:

    #210 TOM The IT and support admin people are going to have great difficulty finding jobs as well too.

    We are in a receesion,and this is and will affect most industries/professions.jobs.

  217. 3b says:

    #194 Mike: EXACTLY!!

  218. njpatient says:

    207 morph
    “No, really tell us how you fee1! (Sarcasm off). I hope never to piss you off!”

    That was necessary because I haven’t heard enough from gary recently?

    Gary, we hardly knew ye!!!!

  219. 3b says:

    #215 Cindy: Well you know much more than you think.

  220. Tom says:


    Some time ago I believe njpatient made a comment that some people believe that the people facing foreclosure should have be penalized above losing their homes. I found that hard to believe and when I saw some of your posts I wanted to understand your reasoning better.

    I kinda get it but I still don’t agree with it. In my view, a borrower generally makes one mistake and I can let one mistake go especially considering they had to deal with realtors and mortgage brokers telling them they weren’t being stupid. That and the fact that most subprime lenders aren’t going to be the most financially savvy. An individual bank on the other hand made the same mistake over and over hundreds of thousand of times if not more. They should have known better.

    I even feel a bit sorry for the investors that purchased these securities based on false ratings and information. They should have taken a closer look but it does seem like they were being conned too.

    If it wasn’t for non-prime lending, the housing bubble could have peaked in 2003. That’s when the origination of conforming loans hit it’s peak falling by 50% in 2004.

    The federal government had a role in this as well. Some of the legislation encouraged this to go on. In fact when Georgia, New York, New Jersey and New Mexico started coming out with legislation that would put purchasers of subprime based securities on the hook if the loans were deemed to be in violation of the states’ predatory lending laws. And then the federal government intervened and the states’ legislation went away.

    The bigger lenders like Citi and GE Money seem to have gotten in late in the game. In 2006, while companies like HBSC and Countrywide were decreasing the amount of subprime loans they were originating, Citi actually doubled theirs compared to 2005.

    I guess we’re not going to agree but thanks for taking the time to explain.

  221. njpatient says:

    216 bairen

    “Please never ask john if he is “coming”.
    Instead use words like “join” or “attend”.”

    Now THAT’s a post to start the weekend!!!

  222. 3b says:

    #225 njpatient: Where is gary? I thought he was on vacation last week.

  223. njpatient says:

    218 cindy

    “With fifth and sixth graders, when you are on recess duty and the bell rings you don’t say “Hold onto your balls.” You say “Hold on to your equipment.””

    I hadn’t realized that that was how that particular euphemism was coined.

  224. Tom says:

    223: 3b,

    My point is that if you’re skills aren’t tied to finance, you have more options. An HR staffer can manage staff anywhere, an admin can do their work in most industries, IT help desk, infrastructure same deal. Programmers with a heavy focus on financial systems may need to prove they can do more than that.

    Plus, like I said, housing has been sucking a lot of money out of people. As the housing issues resolve, and people’s finances start getting better, more money will start going into other areas of the economy, not just to lenders. That will make more opportunities in other sectors while banks are unlikely to be staffed at the same level again. It’s not going to happen overnight though.

  225. njpatient says:

    229 3b
    I hope so
    I’ve been needing a dose of gary to keep me regular.

  226. Tom says:

    218 cindy

    “With fifth and sixth graders, when you are on recess duty and the bell rings you don’t say “Hold onto your balls.” You say “Hold on to your equipment.””

    You said doodie :)

  227. spam spam bacon spam says:


    I know a subprime borrower.

    In over his head.

    SHOWS NO INCOME AND HAPPILY PAYS NO TAXES. (But will gripe about them *and* thinks GWB is the greatest president ever – yes, the *GREATEST*, sends everyone emails saying history will judge GWB and prove he was best pretzelnit ‘eva’… anyway, I digress…)

    He described the meeting he had with the lawyer’s PL who was preparing all the loan docs. He said he “asked” what he should put down for income (like anyone would ask…) and “she told him $X, everyone is doing that”…he JUSTIFIES his decision to lie on the fact that it was SOP. He laughed when he told me the story on how he got his bogus mortgage. I remember the nonchalant shoulder shrug that accompanied it, too.

    He *KNEW* it was wrong.

  228. njpatient says:

    227 Tom

    You’re right about what I said. I think that holding individual borrowers to some sort of messed up moral obligation that is not reflective of any legal/financial obligation that has ever been papered, and is a moral standard that no one would put on a bank, is idiotic.

    On the flip side, adults have to be responsible for their actions, and to the same degree that I am not willing to hold borrowers to a higher moral standard, I am not willing to hold borrowers to a lower legal standard. The borrowers were, for the most part, acting upon the same impulse of GREED that the lenders were acting on. They didn’t need to buy those houses at those prices with loans of those amounts on those terms. They could have rented.

    I am not paternalistic enough to say that those borrowers ought not have been allowed to make their own decisions. Let them have the freedom to borrow, and let them live with the consequences.

    I have yet to be told the sob story of a borrower that makes me feel bad for their situation – if you have a good link, please let me know. In the case of every supposed sob story published in the NY Times, CNN/Money, CNBC.com and etc., I find myself asking “how could any sentient adult have thought it reasonable to borrow $500K on a household income of $40K??”

    The lenders and borrowers can burn in the same fire, as far as I’m concerned.

  229. njpatient says:

    234 spam


    Those ARE the droids I am looking for.

  230. njpatient says:


    “He *KNEW* it was wrong.”

    So many folks like your acquaintance did the same, and so many of them sneered at those of us who were stupid enough not to do so.

    And now us “stupid” folk are being asked to bail them out.

  231. HEHEHE says:

    Nice GTG. Good to put some names with faces.

  232. alia says:

    238th! and still renting! (i always get here after all the fun. sigh)

  233. Clotpoll says:

    John (184)-

    “Vasoline with pubs sticking out I once UPS’d dang that was funky.”

    John, you are the Dickens of the internets.

  234. Clotpoll says:

    BC (196)-

    “Fannie Mae and Freddie Mac. End of illusions”

    Should be:

    “Fannie Mae and Freddie Mac. End of Days.”

    Great weekend, all. Off to hours and hours of soccer in burning hot sun. Be back Sunday night. Hope no banks fail in the meantime. :)

  235. kettle1 says:


    come to find out from tis GTG that people seem to think i am an old drunk…

    Not Kettle

  236. Mikeinwaiting says:

    Kettle you in the Roxbury area?

  237. Tom says:


    Of course he thinks GWB is the greatest president ever. He was the one that was pushing for more the FHA to increase homeownership as well as other legislation and practices that made a lot of this possible.

    I’m curious, when did he purchase his home and if he’s having a hard time keeping up payments?


    There are a few foreclosure stories I’ve read that I’ve felt a bit sympathetic towards the homeowner. They usually involve a homeowner that had some sort of hardship that led them into foreclosure. They had their home before the bubble though. When they hit hard times they got scammed by people that stripped the sizable equity they had out of their homes and left them in worse shape than they were. Under the circumstances, they could have used the equity to come up with a legitimate arrangement that could help them through the tough times.

    Other stories, like the one spam described, trouble me. The brokers were telling people to commit fraud. It’s not like these people came up and lied to the lenders. The lenders didn’t care, they just wanted to originate more loans so they could sell them. There have been other instances where people get talked into subprime arms with promises of being able to refinance to a better loan after they make payments for a few years. But when the loan resets, their broker doesn’t return their calls and they can’t afford the new payments that their broker told them they’d never need to make.

    A lot of these people couldn’t even refinance because their original loans had large prepayment penalties. Because these mortgage based securities lose their value if they are paid off sooner, the banks made sure to include these terms in many of them.

    It’s not like the borrowers were controlling the money and putting out commercials saying “Now’s a great time to lend!” or anything like that. The banks determine who gets loans and who doesn’t and they bent over backwards to give out these loans.

    That said, if these borrowers lose their homes I won’t be losing any sleep. If the government bails them out I’d be pissed. More because if they borrowers get to keep their homes it’s because the government is really bailing out the lenders. The bail out isn’t going to be to allow them to keep their homes and the banks get squat.

    I think the people that can’t afford to keep their homes should lose their homes, the banks that made bad loans should lose their money, well more like use their record profits to make up for their loses. The people that committed or promoted mortgage fraud should pay hefty fines and/or go to jail. The sooner we do this the more we can get back to normal. In the meantime I hope people stop buying. We’re going to be in a declining market for a long time.

    Just like with the employees of a bank like Citigroup. During the boom they added 10’s of thousands of employees. Why should those people be entitled to their jobs now that the market went south?

    The lenders were conning buyers and and investors so that they can make money trading loans between the two.

    Like I’ve said before, buyers have always wanted to buy homes, the trouble happens when banks agree to give it to them out recklessly. The data I’d be interested to see is the rate of rejected mortgage applications. I haven’t found anything yet other than in the UK during a 6 month period 1/3 of the applications were denied while in the 6 months prior to that only 1/5 were.

    While I don’t have much sympathy for the individuals losing their homes, I don’t think they’re the ones to blame for the mess. If they didn’t buy the house, the broker would have found some other person. Loans were even given to people in jail. I’m still waiting for the stories where loans were given to dead people.

    Borrowers had to contend with NAR, brokers, lenders, attorneys, the shows on TLC, A&E, HGTV, etc. all telling them their doing the right thing.

    Investors who bought subprime based securities had bogus credit ratings to deal with.

    Our government encouraged the banks to do what they were doing. In fact, if it wasn’t for government intervention, there would be no Citigroup. I wouldn’t be surprised if the law changes and Citigroup is forced to break up into it’s parts again.

  238. alia says:

    btw, got an email from the president of my credit union today. the first paragraph was:

    If you’ve heard the news recently, then you’re probably aware there has been a great deal of speculation about financial institutions and their stability. There’s no denying that we’re in economically challenging times; which is why I wanted to take a moment to assure you that you’re a member of a financially strong, well-capitalized institution.
    trying to decide whether i feel more safe, less safe or no change. admit to some nervousness when i read “well-capitalized”… i’d like to think that he does mean financially, not that their caps lock keys are in good working order… but didn’t indymac say they were well-capitalized? or was that freddie mac?

  239. njpatient says:


    Brokers who committed fraud should go to jail.
    So should borrowers who did the same.

  240. alia says:

    njp: that sounds like an easy answer to a hard question. you may want to diversify your catchphrases.

  241. Tom says:

    “Brokers who committed fraud should go to jail.
    So should borrowers who did the same.”

    I agree, I just don’t think it’s that black and white.

  242. Rich In NNJ says:

    Bergen County GTG (155),

    It’s been awhile (3-4 years) since I’ve been haunting bars in Bergen County but after I was “released back into the wild” (9-10 years ago) I frequented MANY a dive, pub and even club. So after shaking the cob webs and thinking about the type of locations that would best suit an informal get together of a rag tag group, I thought of the following (aside from Burke’s in Ramsey in post 155).

    To be more “central” within Bergen County there are the following two “jernts” in Ridgewood.
    The Office: crappy food (it’s not about the food) but large bar area with pub tables and large selection of beer (if you’re into beer). Kind of “fratty”
    Smith Brothers: eh, I can say pretty much the same thing as above, but less frat house feel and smaller beer selection (if you care about beer). They recently redid the place and the owners seem to be “good people”.

    Also, Allendale Bar & Grill (in Allendale): Two bars, so better opportunity of bar space.

    And like Ramsey, all bars are within walking distance of the Bergen/Main Line tracks.

    For dates I’m thinking the first or second weekend in September?

    Mull it over, throw out some thoughts, places and dates.

  243. Rich In NNJ says:

    come to find out from tis GTG that people seem to think i am an old drunk…

    Nah, I never pictured you as being old

  244. Rich In NNJ says:

    When I think of old I think of Pat or ChiFi.

    Mostly Pat.

  245. marine says:

    Hi everyone. My name is Ray, from Utica, NY. I will be visiting Poland soon, and I am hoping to meet my Polish relatives. I also hope some people from here may help me in contacting my relatives before my visit. Thanks and looking forward to meeting some great people on here!

  246. Everything's Hobroken says:

    re: 244

    ‘The brokers were telling people to commit fraud’

    I haven’t heard the ‘The devil made me do it’ excuse used so commonly in a long time. It is good to know that these sob stories can still bring a tear to the eye of the credulous.

  247. Orion says:

    Wish me luck, please.

    Today, instead of enjoying the ocean, I’ll be sitting at an open house hoping to unload a condo that I never wanted to buy in the first place. Though it is listed with MLS, I’m hoping to rush the process along.

  248. BklynHawk says:

    242. That link, strangely, wasn’t too far from what I was thinking. Then, whenever you wake up, you head over to the computer and add a comment.

    So, now that I have some more faces to blog handles, I’ll eliminate more concocted images.

    Nom, good luck today at the open house and be sure to “…come running with your checkbook.” as one realtor told me back in 2005.

  249. scribe says:


    You’re such a fresh-faced young’un, I would have carded you :)

  250. Pat says:

    Grim, it’s time to wake up now. Wake uh-up.

    Rich, being an old woman is like being a box of chocolates. Problem is all the old diabetic men.

    Skep, that was a nice thought piece that CF reprinted. Glad he did that. If anyone else ever sees a post that hits a homer, please repost for the old folks who can’t go the distance any more.

  251. Pat says:

    Grim, it’s time to wake up now. Wake uh-up.

    Rich, being an old woman is like being a box of chocolates. Problem is all the old diabetic men.

    Skep, that was a nice thought piece that CF reprinted. Glad he did that. If anyone else ever sees a post that hits a homer, please repost for the old folks who can’t go the distance any more.

  252. grim says:

    Grim, it’s time to wake up now. Wake uh-up.

    I’m up, I’m up. Waiting for the coffee to finish brewing.

    I’m off to DMV this morning, wish me luck.

    I’m a year overdue for inspection, and since the local PD went out of their way to remind me, it’s the least I can do.

  253. HEHEHE says:

    Reminds me of my worst trip to the DMV. Went to a Jimmy Buffet concert, got obliterated, and lost my wallet. Had tickets to the next night’s show so had to get my license to make sure I had no problems getting beer. Get to the DMV, hungover as hell, wait in line, get to the front, they tell me the photocopy I have of my birth certificate isn’t good enough, they need the original. Drive all the way out to my parent house, get the original, and fortunatley make it back just as they are shutting the doors. Haven’t lost a wallet since.

  254. victorian says:

    If anybody missed this…

    “Recession-Plagued Nation Demands New Bubble To Invest In”

    “What America needs right now is not more talk and long-term strategy, but a concrete way to create more imaginary wealth in the very immediate future,” said Thomas Jenkins, CFO of the Boston-area Jenkins Financial Group, a bubble-based investment firm. “We are in a crisis, and that crisis demands an unviable short-term solution.”

    Current bubbles being considered include the handheld electronics bubble, the undersea-mining-rights bubble, and the decorative office-plant bubble. Additional options include speculative trading in fairy dust—which lobbyists point out has the advantage of being an entirely imaginary commodity to begin with—and a bubble based around a hypothetical, to-be-determined product called “widgets.”

    Linky –

  255. me says:


    Nice of you to wake up….

    now.. when’s the next GTG that the *rest* of us can go to??


  256. HEHEHE says:

    It’s all about me.

  257. willwork4beer says:

    Good luck Grim. Took my POS to inspection last Thursday, was shocked when it passed. Next morning, the Service Engine Soon light comes on. Is two years soon…? :).

  258. njpatient says:


  259. Joeycasz says:

    I’m off to DMV this morning, wish me luck.

    I’m a year overdue for inspection, and since the local PD went out of their way to remind me, it’s the least I can do.


    I was so late on my work van one year that i was only shy about 3 months before it had to go AGAIN, and this is was only about 12 months ago, haha.

  260. Sassy says:

    Interesting NYC real estate / economy anecdote from the mommy fronts… Recently have been talking to a large group of moms – we’re trying to find a new family for our nanny to work with (due to medical debt we can no longer afford her, even though we really need the extra set of hands due to our child’s disability)..

    I expected our nanny to find a new job easily in Manhattan, until very recently this was the nanny market. To my great astonishment, the majority of responses are from families who are leaving the city, and moving to their 2nd homes – or purchasing new homes – in NJ / Westchester. Yep, leaving the city – surprising to me, due to commuting / gas expenses, etc… but they all say it makes better economic sense. So, this may be the beginning of a shift. I’ll talk to the public school in Sept and see if they have seen any substantial changes in enrollment yet, but perhaps not, since our neighborhood is still the “it” neighborhood due to mega development. Also interesting, the moms can’t find anyone locally to be nannies, and frankly, the pay and benefits working for some of these families isn’t bad! Up to 50 / 60K, with 401Ks, etc.. on the books, and a car.

    Also, received a sales call from Lehman about a week ago at the office … Looking for us to place our $$$ with them. I had to refrain from laughing, and wished the poor man much luck. At least someone there is still trying to drum up a little business.

    Sorry I missed the GTG, I really would have loved to have put some faces with “names” and discussed the next phase of the big “pop”. Will have to wait patiently I presume till the next NYC GTG!

  261. scribe says:

    morning, patient

    It was nice to make your acquaintance last night.

  262. PeaceNow says:

    Orion—261—Just curious, but isn’t your condo in Asbury Park? I seem to recall that you bought there, but I could be totally wrong.

    Was sorry to miss the GTG, not only to put faces to names, but cause I love a chance to get into the city. Unfortunately (for the GTG), I was already signed up as a volunteer for the annual Ocean Grove House tour. Interesting side note from that: Realtors were trying to cash in on the 800+ attendees by holding open houses. Can’t blame them, but doubt they sold anything.

  263. bairen says:

    Zimbabwe introduces $100 billion dollar note


    Is this where Bergabe is getting his policies from?

  264. bairen says:


    I went ot the buyrite in South Plainfield and I’m now the proud owner of a 6 pack of Coopers Extra Stout and a beer I never heard of called Baron’s Extra Special Bitters. I liked the Aussie bitters so I thought I’d give this one a try. The store has sold out of Boag’s before I got there. They told me to call ahead next time and they’d reserve some for me.

    thanks for the info

  265. Sybarite101 X says:

    WTF are people thinking!!


    What???? Helloooo? What is this realtor smoking? I want some.

  266. Sybarite101 X says:


    Now it makes sense. Suckers paid $759k on 8/18/05. Good luck with that.

  267. HEHEHE says:

    Look at that kitchen. Where’s the stainless steel?

  268. Fiddy Cents on the Dollar says:


    $800K for a cape in Madison!?!?!? Yikes!

    That is preposerous. And that kitchen photo…can you take the time to remove the dishrags from the oven handle? And what’s on the kitchen floor….it looks like the cat barfed up some hairballs! Take in minute to make the kitchen presentable.

    I would bet this was purchased with an 80/20 mortgage and the 20 is now carrying a 12% rate. Killer!

  269. Tom says:

    “I haven’t heard the ‘The devil made me do it’ excuse used so commonly in a long time. It is good to know that these sob stories can still bring a tear to the eye of the credulous.”

    The devil made me do it implies there was a fictitious third party. In this case, the people giving out the loans were the ones telling some of the homeowners to falsify documents. If someone keeps asking you to punch them in the face and you punch them in the face you’re not going to get convicted of assault.

    It’s not like there isn’t a whole system in place to insure that this sort of thing doesn’t happen. Underwriters didn’t do a good job and it seems like it was intentional. Lenders only cared about the volume of loans originated not the quality since they had ratings agencies understate the credit risks.

    The AMC mortgage fraud case is something different where AMC was falsifying documents to get multiple mortgages on the same home keeping each lender in the dark about the others. In cases where there is only one bank involved and the lender closed their eyes voluntarily it’s a whole other matter.

    The banks were strip mining the housing market to sell to wall st. When they reached the point where the purity of the material they were pulling out of the mine wasn’t good, they just got people to certify that it was still good.

    It seems like some of you work in the finance industry and are upset with the predicaments you might be facing, but it’s naive to think that millions of home buyers working individually managed to pull the wool over the eyes of the realtors, the mortgage brokers, the banks, the underwriters, the attorneys, etc.

    I’m still waiting to find the story about a dead man buying a house. This is the closest I could find.

  270. Sybarite101 X says:

    The crazy thing is, all the realtor/seller needs to do is search for <$800k homes in Madison on craigslist and they’ll see how ridiculous the asking price is.

    Unless they sit on that property for 10+ years, I think they’re bound to lose money upon sale. I gotta try to keep tabs on that one to see how it ends up.

  271. willwork4beer says:

    278 Bairen

    Happy to be of service. BTW, I noticed that Little Brothers in Flemington had J Boag and Baron’s during a visit this past week. In addition to the Baron’s ESB, they had a “wattleseed ale”. I guess I’ll have to take one for the team and try it one of these days.

  272. willwork4beer says:

    Sybarite101 X

    Sorry I haven’t gotten back to you on the Palo Santo. I tried e-mailing the local distributor and the brewery itself. When I get an answer I will share info.

  273. willwork4beer says:


    Sorry about missing the GTG. Manhattan is a bit of a haul for me. I live 5 miles from the Delaware River. I know its a feeble f’n excuse. I am hoping this report from the hinterlands will help to make up for my absence:

    Hunterdon County Comp Killers:

    MLS#: 2440515

    109 Junction Rd.
    Hampton Boro

    SLD: 05/25/06 $726,635
    OLP: 09/04/07 $650,000
    SLD: 07/14/08 $480,000

    DOM: 274

    MLS#: 2512575

    1 E Railroad Ave.
    Hampton Boro
    AD: 1 E Railroad Ave.

    SLD: 06/11/04 $221,450
    OLP: 04/26/08 $234,900
    SLD: 07/15/08 $205,000

    DOM: 76

    MLS#: 2465349

    14 The Cresent
    Union Twp.

    SLD: 07/11/05 $168,000
    SLD: 03/23/06 $207,900
    OLP: 11/02/07 $175,000
    SLD: 07/16/08 $159,000

    DOM: 206

  274. Tom says:

    “MLS#: 2440515

    109 Junction Rd.
    Hampton Boro “

    I was going to say it looks like the builder made a killing on that property. But it seems like it is a new subdivision started in 2005 and only about 1/2 the homes seem to have been sold. Not sure how many have been built though. That’s really going to hurt future sales.

    I’m not sure if I pulled up the right maps, but it seems like it’s right in the middle of a big school and some industrial complexes.

  275. chicagofinance says:

    Tom Says:
    July 19th, 2008 at 11:10 am
    It seems like some of you work in the finance industry and are upset with the predicaments you might be facing, but it’s naive to think that millions of home buyers working individually managed to pull the wool over the eyes of the realtors, the mortgage brokers, the banks, the underwriters, the attorneys, etc.

    GPS: Interesting. So the fact that someone is willing to call you out on hipocrisy implies that such a person has an axe to grind. This perspective suggests that certain of us are “walking wounded” willing to spit out harsh vitriol and bile on any able-bodied target, as opposed to well educated and informed persons who have been participating in these types of discussion for several years. Maybe some introspection is in order instead of pointing outward?

  276. skep-tic says:

    Tom– what is perplexing is that you seem to want to blame everyone but the people who actually borrowed the money. For them, you offer nothing but excuses.

    I am curious: are you the type of person who thinks all criminals are really victims?

  277. skep-tic says:

    FWIW, I my criminal law professor in law school actually thought that all criminals were victims. Not exaggerating. She was very smart and seemed amazed by the brilliant and intricate excuses she crafted for murderers, rapists, etc. Point is that some people prefer to see complexity where there is simplicity, because the complexity allows for more mental gymnastics and entertainment.

  278. Tom says:


    If you ever want to drop the attitude and name calling and start posting actual substance I’d be willing to have a reasonable discussion with.

    Until then I’m only going to point out the timeline.

    We all thought homebuyers were stupid for buying such expensive properties. The homebuyers were in denial and many still are.
    Then we find out these new lending institutions were giving out very risky loans and were suffering loses.
    The big banks told us they would be ok and the subprime market was constrained to these new banks making bad decisions.
    We start finding out the big banks were dishonest and their exposure to the non-prime lending was much greater than they first let on

    My position has always been the same. The people that bought these houses that can no longer afford to keep them shouldn’t. The banks that made these bad loans should suffer the consequences. The tens if not hundreds of thousands of employees that were hired to handle the volume during the boom should be let go now that the companies can’t afford to keep them. If it wasn’t for the federal governments involvement in encouraging this to happen and removing legislation that would have prevented companies like citigroup, which consolidated the lending, underwriting and trading of mortgages under one roof, from forming. They also stopped states from being able to enact their own laws to put an end to the types of practices that led us to this mess.

    The housing bubble was a false economy. As others have stated in the past, homeowners that bought during the bubble may be on shaky ground. Those that were hired into the financial sector during that time now are also in peril and need to know that instead of denying it and trying to point fingers.

  279. Magneedo says:

    When we were looking for 1st house in Morris cnty in 2005-06, our realtor and her finance people were always pushing us to get a no interest, no doc loan because she insisted house prices will “ALWAYS” go up. I was looked at as if I had 2 heads for wanting a 30-yr fixed from our credit union. She even whispered to my wife behind my back that I was a fool for not trying to max out on a mortgage.

    I knew we couldn’t afford after an adjustment, and thanks in part to this blog we never purchased. I strongly suspect our realtor friend is in another field at this point. I don’t totally blame her either as everyone above her in her field (NAR,brokers, etc.) was pushing the bad propoganda at her also, she really thought she was right.

  280. Tom says:

    “Tom– what is perplexing is that you seem to want to blame everyone but the people who actually borrowed the money. For them, you offer nothing but excuses.

    I am curious: are you the type of person who thinks all criminals are really victims?”


    I want to blame everyone and the people that borrowed money. I just put heavier emphasis on the people that financially benefited the most by repeatedly doing the things that caused the problems and knew what they were doing was wrong and deceived a lot of people. Just like I don’t hold drug users blameless but feel stronger against drug dealers.

    Your in criminal law so consider this situation. A business owner comes up with this hair brained idea. He prints out a bunch of gift certificates (not coupons) to his store thinking he’ll make a killing if they’re used. He goes up to the roof of a building with two suitcases full of these gift certificates, in an impoverished neighborhood whose residents really could use what he sells, and starts throwing them into the street.

    A large crowd below gathers to collect these. Traffic in the neighborhood comes to a standstill. Accidents are caused by this, paramedics and firefighters don’t have access to were they are trying to get to. Police have to be redirected from other patrols to handle this. The result is a number of injuries and lets say a death or two directly and indirectly.

    Who is more at fault for what happened? The mob that was formed or the person that created the mob? I say the person that created the mob.

    If the guy now thinks it wasn’t a good idea does he have the right to refuse to accept the gift certificates and blame the people for trying to use them according to the terms defined on the gift certificates? I don’t think so.

  281. 3b says:

    #289 chgo: Well said.

  282. willwork4beer says:

    Hunterdon County Future Comp Killer:

    MLS#: 2549933

    14 Horseshoe Dr.
    Raritan Twp.

    SLD: 07/24/06 $598,000

    OLP: 07/16/08 $517,500

    REM: Look no further! $10k Buyer Wish List Bonus with an acceptable offer & executed contract on or before 7/31/08

  283. willwork4beer says:

    Hunterdon County Future Comp Killer:

    MLS#: 2549034

    17 Talia Road
    Raritan Twp.

    SLD: 11/18/04 $791,000

    OLP: 07/14/08 $735,000

  284. willwork4beer says:

    Hunterdon County Future Comp Killer:

    MLS#: 2551061

    12 Rowlands Road
    Readington Twp.

    SLD: 09/10/03 $750,000

    OLP: 07/18/08 $699,000

  285. willwork4beer says:

    Hunterdon County Future Comp Killer:

    MLS#: 2550441

    21 Central Avenue
    Readington Twp.

    SLD: 07/27/05 $715,000

    OLP: 07/17/08 $699,999

  286. kettle1 says:

    the daily kettle world report…..

    Anyone moving to georgia???? read this

  287. kettle1 says:


    from out chat last night baout demand destruction……

    <i.The Marshall Islands said Friday electrical power in the small Pacific nation may be switched off in September when its fuel supplies are expected to run out, as high food and energy prices have begun to hit hard some developing countries, particularly small islands isolated from the rest of the world.

    ‘Unless urgent international action is taken, the Marshall Islands will exhaust its present fuel supplies this September,’ said Rina Targo, a representative of the islands at the United Nations. ‘This is a dire situation in which we may be left without electricity for the foreseeable future.’

  288. kettle1 says:

    Nom, scribe:

    nice to meet you and everyone else last night! i owe you a drink next time nom :)

  289. skep-tic says:

    Tom– Ask the risk of repeating myself, I think we are simply looking at this fiasco from opposite directions. I believe there was a demonstrated demand for loose credit in the public that someone was bound to supply. This is not to excuse the suppliers, but the demand was primary.

    I believe that you view the dynamic as one in which demand was CREATED by the suppliers. During the last legs of the bubble, where lenders were really shaking the tree for any borrowers they could find, this makes a bit more sense to me. So I am not completely discounting your view, to the extent I have accurately described it.

  290. Mikeinwaiting says:

    Sorry I missed it, just to far.
    Kettle I gather you were in rare form.
    Bully for you.

  291. Tom says:


    I think we’ve covered the differences in our opinion enough so I won’t get back into it. But I will expand on your second paragraph where it seems we might share some common ground.

    There was a staff report by the FRBNY about the securatization of subprime mortgages. Basically, for whatever reason, early in this decade, the issuance of subprime loans as securities grew dramatically from 46% in 2001 to 75% in 2006. This chart shows the orgination of agency and non-agency loans during the housing bubble. In 2004, the number of conforming loans dropped dramatically while non-conforming loans continued to rise. This is when the “shaking the trees” started. By 2006 the non conforming loans combined were more than the conforming loans.

    The thing that really bothers me from the data I’ve seen, including the sales data that gets posted here, is that it seems like there was much more than just normal market forces at work. House prices kept rising as number of sales and loan dollars originated dropped off. That just screams something fishy is going on to me.

  292. willwork4beer says:

    OT but since its so slow today… just can’t resist:

    The symptoms of prostate cancer rarely show before the disease has progressed, but a simple PSA blood test can serve as an early warning and save men’s lives. But how do you reach men in their late 30s and early 40s, when statistics show they often skip regular physicals and avoid doctor’s offices?

    “Pints for Prostates is an awareness campaign designed to reach men through the universal language of beer.”

    I think I just found my new favorite charity.


  293. willwork4beer says:

    That should have read:


    The main site is Us TOO International Prostate Cancer Education and Support Network


  294. rhymingrealtor says:


    Why so hard on Tom? I think his reference to drug users and drug dealers makes his point clearly and so does the fact that banks did the same thing over and over where the buyers did it once. Many of us did not partake but will surely feel the sting of the fall-out. I know I personally am feeling the sting all of our expenses have gone up but our income has not. As a matter of fact as of August 1st it will be cut significantly as that is when my husband will no longer be working. Bigger forces than the stunod next door have caused this mess, the stunod had one of the smaller parts.


  295. spam spam bacon spam says:

    is it me?

    did I miss something important in this listing?

    The price changed UP 5 whole dollars?!?!…

    Garden State M.L.S.:
    MLS# 2512297
    LP $1,505,000
    DOM 83
    LD 04/27/2008
    OLP $1,500,000
    ADM 83

    /scratches head…/

  296. Laughing all the way says:

    Love the title of the NYT front-pager: THE DEBT TRAP. Scary stuff.

    Too bad that the people who NEED to read it, will never see it.

  297. skep-tic says:

    here’s what I think re: the banks (same sort of holds true for the rating agencies).

    I think the mortgage originators absolutely knew that they were facilitating widespread fraud from beginning to end of the bubble.

    Higher up the foodchain, I think it took a lot longer for people to realize the extent of the problem. In the last year or two of the bubble, I think there was at a minimum lot of willful ignorance by the people doing the securitizations.

    But prior to that, I think they really believed they had found a way to acceptably diversify the default risk associated with subprime/Alt-A credit. They were wrong in part because the original inputs into the models were false (e.g., debt to income ratios were totally unreliable) and because this bubble was really unprecedented.

    Obviously, the 2006-07 vintages of securities were really the worst, so the banks doing the securitizations are certainly blameworthy. I just do not think they are as blameworthy as the originators and borrowers.

  298. Jill says:

    Hey, soon even I might be able to go to the GTGs, since I will be out of work as of August 30 (grants running out or falling through). Anyone need a web developer/online content creator and/or editor/Jill of all Web trades?

  299. bi says:

    Maybe Phil Gramm is right, we are “a nation of whiners.”
    GDP was up 1% in Q1; gas is down 20cents in my area in last 3 days; banks bounced back 23% from tuesday low;

    BTW, for the record i am neutral on SKF now.

  300. Cindy says:

    (294) Tom –
    I hope you hear me say that I believe everyone was culpable….That man should not have tossed those gift cards off of his roof and pushers shouldn’t be selling drugs… But in the end…I believe – It will always come down to everyone taking personal responsibility for their actions.

    My personal opinion is that the people in that neighborhood who thought they could get something for nothing and massed dangerously in the streets paid a price for their actions.

    It is a choice to use drugs.

    (308) “In 2004, the number of conforming loans dropped dramatically while non-conforming loans continued to rise. This is when the “shaking of the trees” started.

    2004 is also when Greenspan gave his famous speech regarding folks missing out by using fixed-rate mortgages. (I don’t know how to do links – you’ll have to look that up.)
    People are greedy. They saw a chance to have more money each month with a subprime mortgage.

    “House prices kept rising as the number of sales and loan dollars originated dropped off. That just screams something fishy is going on to me.”

    I have always wondered if the 1997 law exempting up to $250,000 ($500,000 for a married couple) from capital gains tax had anything to do with our mess. (As of 2003 you could also qualify for the exemption because of unforseen circumstances, such as job loss, divorce or family medical emergency.)

    Sort of a follow the money idea….I know people who made hundreds of thousands of dollars by living in two places within the 2-5 year time frame. Maybe some pulled money out of the stock market where you had to claim capital gains and played with R/E.

    But what I know happened for sure took place right next door.

    That house sits empty. Lawn dead…renters gone. A speculator bought it in 2006 for $325,000 with a 3.75 interest only – no down loan. He proceeded to rent it out for $1200. Everything was fine until about one month ago. He is under water a good $100,000 and I figure the rate must have adjusted forcing him to raise the rent – to what $2000??? Well, it is now unrentable and he can’t sell.

    He was gambling. He was betting the prices would continue to escalate.

  301. bi says:

    are you guys still thinking housing has long way to go to reach the bottom? even your favorite S&P case shiller index shows recovering in these areas: boston, charlotte, chicago, cleveland, dallas, denver and seattle. again, real estate is a local.

  302. Cindy says:

    My point about the tax thing is that time frames changed. You could make money off of owning a home – tax free- by turning it over every two years…that accelerated the market….in my opinion…

  303. skep-tic says:

    I am pretty familiar with Boston and while I think it is closer to the bottom than NYC, it is not yet recovering. I would say that NYC area prices might fall another 20-25% wheres it wouldn’t surprise me if Boston only fell another 10-15%

  304. bairen says:


    I just finished my first botle of Barons. I thought it had great flavor. Definitely better then VB.

    If you ever come across Crown Lager a highly recommend that if you like lagers.

    Also they alcohol tax is so high in Australia I’m paying about the same for a 6 pack of Coopers in NJ that I was paying in Sydney 18 months ago. They were going for $9.99 AU a 6 when I moved back to the US in Feb 07.

  305. Theo says:

    bi Says:
    July 19th, 2008 at 6:29 pm

    “BTW, for the record i am neutral on SKF now.”

    What the contrarian position we take on this, buy a straddle?

  306. Cindy says:

    (316) Ooops..”People are greedy. They saw a chance to have more money each month with a SUBPRIME loan s/b “alternative lending vehicle.” Isn’t that what Greenspan called it.

  307. bairen says:

    #319 skep-tic

    i think Boston became bubbly before NJ did and started going down in 05. So they are ahead of us.

  308. skep-tic says:

    bairen– what you are saying would be a repeat of the early 90s downturn, which makes sense to me. for some reason, boston real estate tends to rise and fall earlier than other metro areas in the RE cycle

  309. willwork4beer says:

    Bairen. Glad you are enjoying. Its Stoudts Double IPA over here. Insanely good stuff. I will be on the lookout for Crown Lager.

  310. PGC says:

    #252 Rich

    I vote for The Office in Ridgewood. It is walkable for me and on a train line.

    I went to the Iron Horse last week and didn’t think much of their award winning burgers.

  311. Shore Guy says:

    as for a GTG, how about the Stone Pony midweek?

  312. Tom says:


    Re: off the roof

    The question was who do you think is more culpable? I don’t know about you, but if I was walking down the street and someone’s essentially throwing free money at me I’d have a hard time not trying to get a piece and can’t think of many that wouldn’t.

    I still think the drug pusher analogy is very good especially in relation to ARMs. They get you hooked on a teste and then before you know it no more free ride as the loan resets and you’re payments double.

    “2004 is also when Greenspan gave his famous speech regarding folks missing out by using fixed-rate mortgages.”

    A lot of the people getting subprime loans didn’t even understand what they were signing. I would be surprised if they even knew who Greenspan was or did let alone what he said in a speech to the Credit Union National Conference and used that as a basis for their financial decisions. I find it more plausible that their realtors and mortgage brokers were telling them to go with ARMs.

    In any case, Greenspan’s quote on ARMs was:

    Indeed, recent research within the Federal Reserve suggests that many homeowners might have saved tens of thousands of dollars had they held adjustable-rate mortgages rather than fixed-rate mortgages during the past decade, though this would not have been the case, of course, had interest rates trended sharply upward.

    That doesn’t read to me as an endorsement for using ARMs. What that says, from reading more of the context, is that in the past 10 years you would have been better off with an ARM that would readjust along with falling interest rates rather than incurring fees every time you chose to refinance. If interest rates were to rise, ARMs wouldn’t be as good a choice. 2003 is when the prime rate hit it’s bottom and by 2004 was rising. 2003 the prime rate was around 4. Did people really think it was going to keep falling that much far below that?

    Anyway, one of the points I was trying to make is that after 2003, the amount of money given out in mortgages dropped sharply while house prices continued to rise for a number of years and that seems very odd to me.

    “I have always wondered if the 1997 law exempting up to $250,000”

    I think that might have caused problems in general but I couldn’t comment one way or the other. It’s an interesting thought though and I wouldn’t be surprised if it played a role. I do remember people mentioning that as part of their decision to sell.

    “He was gambling. He was betting the prices would continue to escalate.”

    Yep. A lot of people were. A lot got burned but those that got in and got out early made a ton like you mentioned. I almost did too a couple years before the bubble burst but I decided it was probably too late as I didn’t see any really good deals in properties that needed work. I always kind of speculated we were in a bubble but never looked deeper into it until that point. One of my relatives that knows a few builders was telling me how they made a killing buying properties in certain areas, subdividing and building a duplex. Once they couldn’t purchase an appropriately sized lot in the right zone for $400k they stopped and went into remodeling or fishing :) One other that didn’t has homes that have been sitting vacant now for months.

  313. kettle1 says:


    re boston:

    also consider that boston actaully has a strong job market relative to NJ and isnt in the process of losing it 2 biggest employment fields. Nj is ( finance and Phamra).

  314. Cindy says:

    You know what Tom, since you do look deeply into things and I can barely type on a computer, let me know if you find any correlation between the accelerated pace of home turn over (with the price going up each time it is sold) and the capital gains law changes.

    Often times it is a follow the money thing and it suddenly became profitable to move every two years instead stay in the good ole family home.

    Keep me posted if you find out anything..

  315. skep-tic says:

    I think that Boston might have a marginally stronger job market than NJ, but its still not easy to find a great job there. My impression is that competition for good jobs is very high there due to the overall high education level of people in the area. We have also just seen the first quarter in 30 yrs without a venture backed IPO. Not sure if this is indicative of a long term trend, but it doesn’t seem like great news for places like Boston

  316. Everything's Hobroken says:

    re: 283 ‘requires a third party’

    No, it does not, it requires dishonesty and the desire to shift blame away from oneself.

    ‘gift cards’ and ‘drug pusher’
    These analogies are inapt. A much better one is the pigeon drop.

    ‘free money’

    Your statement that you are tempted by these cons expresses rather more than you ought.

  317. BklynHawk says:

    Jill I know of a web designer position, NJ based. Do you have experience doing that?

  318. Tom says:


    If I find anything I’ll post back but I don’t actively search everything. Like most of you I just have an interest in this and try to find out what’s going on so I can see how it will affect me. I’m not in finance or real estate other than putting online a site based on some programs I wrote to satisfy my own personal curiosity which I decided to make freely available.

    I only know what I know and try to learn more from people that might have different views and opinions and share what I’ve learned. Hopefully in the end we both wind up more educated than we were when we started.

    You should really take a look at the chart I posted a link to. Or google for the document it came from. A long but interesting read. I just uploaded that chart today and other than the hits from me checking to make sure it was there, nobody else has downloaded it.

  319. Tom says:

    Everything’s Hobroken

    “re: 283 ‘requires a third party’”

    Normally if you put something in quotes it means you’re quoting. Sometimes people use single quotes if they’re slightly paraphrasing. What you attributed to me saying is very different from what I actually said which was “implies there was a fictitious third party”.

    You’re right in that pigeon drop is a good anology. For those that don’t like to click links: “name of a confidence trick in which a mark or “pigeon” is convinced to give up a sum of money in order to secure the rights to a larger sum of money, or more valuable object. In reality the scammers make off with the money and the mark is left with nothing.”

    In this case the homeowner gets left with nothing while the bank walks away with a house after foreclosure and 10’s of thousands of dollars worth of mortgage payments before the borrower defaulted.

    “Your statement that you are tempted by these cons expresses rather more than you ought.”

    If you could resist trying to grab some if some guys throwing away millions worth of gift certificates from a rooftop, that’s pretty impressive. But I doubt most people would.

  320. Tom says:


    I used to think a little more like you did until I fairly recently learned about an anti-flipping rule established in 2003 was suspended. They first started discussing the rule in 2001 after seeing that the banks were “artificially inflating” prices of homes they gained through foreclosure. If the FHA already determined banks were artificially inflating house prices in that regard I’m going to be more suspicious of their role in other areas as well. I think we can all safely say that home prices are higher than they should be.

    I would also tend to agree that things probably started out innocently enough when it was the smaller subprime lenders that were originating the majority of loans. Once the larger banks started participating things got a lot worse. Organizations like Citigroup also have more direct control and influence over the different parts of the food chain through some of their mergers. Allowing a big subprime originator to also be an investment bank might have not been such a great idea.

  321. Cindy says:

    (334) Tom

    “I only know what I know and try to learn more from people that might have different views and opinions and share what I’ve learned.”

    Excellent. That is awesome. That is why I am here, too. It is obvious that you are knowledgeable and passionate about the subject.

    It’s just that we don’t usually argue this much. Once someone has demonstrated that they are diametrically apposed to our view we pretty much drop it and respect that.

    Here’s a good one from the movies. Something I have passed on to my daughters….

    Harvey 1950 – “Years ago, my mother used to say to me, In this world Elwood, she always called me Elwood, In this world you must be oh so smart or oh so pleasant.

    Well, for years I was smart. I recommend pleasant.”

  322. skep-tic says:

    The thing is Tom that the “homeowners” (scare-quotes) did not get screwed in these transactions.

    They basically got a free option on house price appreciation. If the house price went up, they could sell or refinance and capture that appreciation.

    If the house price went down, they could walk away and the only cost to them would be the hit to their credit rating.

    The monthly payments they made were artificially low due to teaser rates and did not truly reflect the cost of capital for borrowers with their risk profiles. So I fail to see how these people got screwed. The banks are losing real money right now, but these borrowers are really only getting a mark on their credit reports which will go away in a few years.

  323. Pat says:

    Skep, I know many who got in and out.

    They knew the score.

    Now they’re back to nursing and such. Not a loss amongst the crew. They whistle like the seven dwarves. Happily off to the next thing.

    And my eldest sis and her retired husband (who took a real estate class in 1975), have stopped moving from house to house – NC, Florida, Georgia, und so weiter, and have settled down in a small two bedroom bunker-type place out in the country. Between 1997 and 2007, they moved five times. She ended up with a small UHaul of stuff. Not much for 45 years of marriage.

    There was plenty of fat to go around. Tom’s free coupons didn’t start the rush to the buffet. People always gravitate to fress, free coupons or not.

  324. Pat says:

    Cindy, Tom needs at least two more months of John’s stories before he moves into cruise control with the rest of the crush valor groupthink.

  325. Pat says:

    Tom, btw, you’re doing a helluva good job.
    Anytime you see righteous brothers like CF and Skep standing up, you’re there.

  326. Cindy says:

    Hi Pat, How ya doin’? I was just sharing some home-spun musings. The daughters, 28 and 30, tell me they like this one too:

    Would you rather be right or would you rather have a relationship?

    That one came in handy when they were teenagers….

  327. kettle1 says:

    Tin foil hat warning!

    But SAS will appreciate this


    On March 13th 2008 there was a secret closed door meeting of The United States House Of Representatives in Washington. In the history of The United States this is only the fourth time a secret meeting was held by the house

    * The imminent collapse of the U.S. Economy to occur sometime in late 2008
    * The imminent collapse of the U.S. Government finances sometime in mid 2009
    * The possibility of Civil War inside the United States as a result of the collapse
    * The advance round-ups of “insurgent U.S. Citizens” likely to move against the government
    * The detention of those rounded up at The REX 84 Camps constructed throughout the United States
    * The possibility of public retaliation against members of Congress for the collapses
    * The location of safe facilities for members of Congress and their families to reside during massive civil unrest
    * The necessary and unavoidable merger of The U.S. with Canada and Mexico establishing The North American Union
    * The issuance of a new currency called the AMERO for all three nations as an economic solution.

    see next post for additional link

  328. Pat says:

    Doing great. Packing and playing in PA.

    I’m trying to decide if I would pay $1.99 to download episodes after today:


    I listened to Act III. Starting at 5:50 it sounds like Jess Whedon reads bubble blogs. I heard “tard,” “sheeple,” and “lemming” in one minute.

  329. Tom says:


    I didn’t think this was a place where everyone should think the same way or get out. I didn’t think I was “arguing” as much as I was trying to have a reasonable debate.

    There was a discussion not too long ago when the AP had considered licensing content to bloggers and I mentioned I could kinda see what their issues are. People told me I was wrong and that bloggers get to the truth. Groupthink != truth to me.

    I sincerely hope your view isn’t representative of the rest of the people here because that kind of thinking is what got us here.


    By 2006, 75% of subprime and 91% of alt-a mortgages had been issued so the banks already made money on a good number of loans shortly after origination. I’m still a bit confused about how investors get their money back if a bank forecloses. Some things I read said the investors have to sue others said the investors can foreclose but when it comes time to foreclose, securitization raises issues on who can foreclose and what happens when the loan is split up amongst multiple investors things get kind of hairy. You might have already read the Judge Boyko’s decision regarding foreclosure of securitized mortgages. For those that don’t like reading legal documents you can google for reactions. Here’s one.

    As I pointed out earlier, as early as 2001 FHA noticed a problem with banks inflating post foreclosure prices.

    The borrowers made a bad decision with their money and credit, in most cases hoping to buy a home for their family not as an investment. The lenders made bad decisions with other depositor and investor money. I think that’s what bothers me the most, they weren’t risking their own money. They were entrusted to make good use of deposits and investments and they ignored those responsibilities. Borrowers really just screwed themselves. I don’t buy the whole they were begging for money and someone had to give it to them. Some of the community NJ banks stuck to their more conservative lending practices and they’redoing great, especially compared to the commercial banks.

    We’ve already seen what happened with Freddie Mac, Fannie Mae and IndyMAC. My fear is that the worst is still yet to come.

    IndyMAC was primarily involved in Alt-A mortgages which were supposed to be safer than subprime and look at what happened to them.

    Freddie Mac and Fannie Mae are supposed to only deal in “conforming loans” not subprime, alt-a or jumbo loans and look at the mess they’re in. Since subprime loans are supposed to be riskier I can only assume there’s going to be a lot more bad news coming. These are the top subprime originators.

    This conversation reminds me of 4 years ago trying to convince people that they might want to think twice before buying.

  330. kettle1 says:


    Is that doogie howser????

  331. Tom says:

    Ugh. long post and it’s in moderation :(


    Pat, how’s your sister doing? I was hoping I could come up with something to say when I first read your comment but it’s hard when you don’t know the person. If you don’t mind some advice, if something a doctor or nurse tells you doesn’t seem right question it and make sure they know you’re checking up on them.There are good hc professionals though that will keep an eye when you’re not around from what I’ve sen. You guys think this is arguing, you should see what happens if you perform an unnecessary procedure on a family member because you didn’t bother to read the first paragraph in their chart.

  332. skep-tic says:

    When I think I am getting pounded at work (and this is one of those times as I am at my desk right now), I remind myself that doctors have it much worse in the early years. It is amazing to me that so many people are still willing to go through all of that

  333. Cirrus says:

    Great meeting you folks, I appreciate all those who were able to make the trek in, and as a former NJ’er, I appreciate all those who would’ve liked to attend but for whatever reason couldn’t make it. (insert comment, “But everywhere in NJ is only xx minutes to midtown!”)

    Really enjoyed talking and meeting and hope to make it to the next one. In the meantime, I’ll just eagerly watch from the sidelines and enjoy everybody’s posts.

    Kettle – thanks for the link, I’ll check it out and when I get back into work-mode on Monday, I’ll see if I can find any interesting charts that may not be floating around in the MSM that might be worth a look.

    Grim – as always, thanks for everything you do.

  334. SG says:

    Why the world’s economies are sinking

    Developing nations are flexing their muscles, while rich countries appear to be weakening in global meltdown

    The contagion of weak U.S. growth has spread to Europe and Japan, the world’s second- and third-largest economies, respectively. Prolonged economic booms in Australia, Ireland and Canada finally have faded; no one’s talking these days about the “Irish miracle” now that Irish job growth and housing values are in decline.

    So much for Foreign investors from Euro zone coming and snapping US properties.

    “The credit crisis, runaway inflation, mind-blowing energy crisis, falling confidence, housing prices – they have created a perfect story,” Henk Potts, equity strategist at British bank Barclays PLC, told the Washington Post on Wednesday. “It’s currently a market for the brave.”

    Yet, that squeeze between lower income and household wealth and a higher cost of living is largely absent in the more dynamic developing world economies. China, the superstar among emerging economies, posted double-digit growth of 11.9 per cent last year and 10.4 per cent in the first half of this year, despite vigorous efforts by Beijing to cool the economy with interest-rate increases and a modest decline in exports to Europe and North America.

  335. SG says:

    The Fictitious Economy, Part 1, An Interview With Dr. Michael Hudson

    A century ago when the classical economists, Adam Smith, John Stuart Mill, in the reform era, tried to say look, there are some incomes that are not earned. Rent is not earned, it’s an excess price. Interest is not earned, it’s a monopoly price. Monopoly profits aren’t earned, they’re extortionate. All this was viewed (by classical economists) as something that government regulators should get rid of, either by not permitting it in price, or by holding the monopolies in the public domain, or by the land itself being either nationalized or taxed. The classical economists divided almost the entire economy into productive and unproductive labor, into wealth, and overhead, into real income and costs. This threatened the vested interests with taxing away their free lunch, so you have an anti-classical reaction that is epitomized by the Chicago school of anti-government, anti-tax people whose leader, Milton Friedman, said there’s no such thing as a free lunch.

    Well, classical economics was all about the free lunch. Look at Ricardian rent theory. That’s all about the free lunch. The role of modern economic theory — I should call it post-modern economic theory and statistics is to pretend that the banks, the landlords and the monopolies actually earn their income instead of extracting it from the (productive) economy.

    BF: You identify a huge bubble economy that has developed as a result of massive debt in several areas. Could you go into how the bubble is being inflated in several areas of the economy?

    MH: All bubbles are inflated by credit, and the Federal Reserve under Allan Greenspan created a huge amount of credit that was lent out to almost anybody for any purpose. A bubble economy is when banks and other lenders will lend to borrowers with no visible means of repaying the loan. A bubble economy occurs when banks will make loans to companies that don’t make enough to pay the interest, that don’t make enough to amortize the debt, that can only repay the banks by borrowing the money and adding on the new loan to the existing balance, and essentially letting the loan grow exponentially through compound interest. That’s impossible to maintain over time because no economy can grow exponentially over time, so the bubble bursts.

  336. SG says:

    Real estate slump brings rise in short sales

    Percentage jumping fast in Las Vegas

    It takes patience and understanding to muddle through the process of buying a home in short sale, local real estate experts said.

    Short sales, or selling a home “short” of the balance owed on the mortgage, have become increasingly prevalent in Las Vegas, where home values have dropped by more than 20 percent in the past year and some 5,000 homes are headed for foreclosure.

    The market is feeding on bank-owned properties and short sales. While more than half of all home sales in Las Vegas have been reported as foreclosures or short sales, the figure is actually closer to 80 percent in the past few weeks, a home loan consultant said.

    About 26 percent of available inventory in Las Vegas, or 5,800 units, are listed as short sales, reported Applied Analysis, a Las Vegas business advisory firm.

  337. Pat says:

    Thanks, Tom. We learned the hard way about questioning medical advice. Fortunately, I’m from a very large family and at least two are very good RNs.

    I think she’s going to be fine.

  338. Pat says:

    She needed to bite the bullet and get out of her small-town treatment mentality so she could get to the big guns on it.

  339. njpatient says:



  340. njpatient says:

    Cirrus too

  341. Tom says:

    Pat, glad to hear she’s doing better.

    I found this video today. It’s just appalling how some realtors will downplay the negatives of a home.


  342. kettle1 says:


    Here is a chart for you. this one is a good overall visualization of the issue, growing demand, decreasing supply


  343. willwork4beer says:

    Found while checking out an REO site.



    B4 maybe..?

  344. Tom says:


    Obviously the oil companies aren’t trying to discover any more oil because the EPA is denying the permits necessary to build new refineries which is why they can’t keep up with demand and we’re seeing the same types of gas rationing and long lines of the 70’s. Don’t know about you but I just get steamed when I drive to the gas station only to find out they don’t have any.

    Damn you environmentalists!


  345. kettle1 says:


    for give me, but my sarcasm meter is currently out for calibration. are you serious or joking?

  346. John says:

    Yields on 30-year mortgage bonds guaranteed by Fannie Mae touched 6.17 percent, the highest since Aug. 16, 2007. Yesterday they were 2.06 percentage points more than yields on 10-year Treasuries, the biggest spread since March 11.

  347. John says:

    RE 199, I your husband works in Brooklyn and you work in NYC, Jersey is a pain. I would say go for the wall street area as they are overbuilding coops and try to sublet a bargain. Don’t buy. Also try LI near Queens border on south shore. LIRR pulls right into brookyn. Flatbush Avenue. Try Rockville Centre if you like trendy nightlight, with hundreds of places to eat and a 35 minute comutte to penn with trains every 30 minutes off peak. Try Lynbrook, East Rockaway, Island Park if you want a little less trendy but still on same line with a lot less rent. Or spend an extra 15 minutes on train and try Long Beach is you love ocean and a good nightlife. But Long Beach is same rents as Rock Center and if you both work in the city that extra 30 minutes wears on you.

  348. John says:


    On a realtor web site that links to this site that tells you income, race, education level and religion of people by zipcode. Guess way around questions people ask that realtors can’t tell you.

  349. NNJJEFF says:

    Can someone with MLS access give me listing history of #2816134. It seems like its been recently go back to the bank

    Thanks in advance

  350. Jill says:

    Re: Bergen County GTG: It’s not in Bergen, but you can’t do better bar food than Bailey’s Smokehouse in Blauvelt, on Erie Street up off Route 303. Dave Finkelstein, formerly of Fink’s Funky and Stickey’s is in the kitchen up there. Great barbecue and Mr. B@B says the best bar burger ever.

  351. Jill says:

    BklynHawk #334: Not specifically a designer, but I have what I regard as a “reasonably good eye” and good feel for user interfaces. Where is the job? I’d rather not do NYC unless I have to. If you want, take this off-list to brilliantatbreakfast at gmail dot com.

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