From MetLife:
The 2009 MetLife Study of the American Dream
…The results show an American dream that has been revised, not reversed. Americans are resetting their priorities, and the dream is now buoyed by pragmatism rather than consumerism. While Americans are anxious about their finances and the national economy, most are still optimistic that they can achieve the dream—a redefined American dream with a greater focus on family, marriage, and financial security.
Other key findings of the study are:
While many Americans are flying without a safety net, more recognize its importance and are saving more, spending less, and thinking more about their life goals.
Work is the linchpin holding the dream together. Half of Americans surveyed report they could survive only one month financially after a job loss.
There is a newfound appreciation for workplace benefits. Employees value the role of employers in helping to build their personal financial safety nets.
Americans are placing a premium on trust, with greater demand for predictable returns and guarantees.
From HousingWire:
Most Americans Hanging on By a Financial Thread: Study
Want a stunning figure? Half of Americans now say they are only one month or less away from not being able to meet their financial obligations if they were to lose their job — just two paychecks or less. And of these, more than half — 28 percent of all Americans — say they could not survive financially for more than two weeks without their current job.
This disturbing data comes courtesy of the 2009 MetLife Study of the American Dream, released Monday, which looks at how the financial crisis has affected the American Dream and consumer perceptions. It’s all the more disturbing considering that unemployment in the U.S. has already surged to 8.1 percent, with 651,000 jobs lost last month alone.
…
The survey data underscores that the mortgage industry would do well to remain focused on economic fundamentals: following a job loss, 59 percent of survey respondents said they’d be somewhat or very concerned about having to file for bankruptcy, and 64 percent would be concerned about losing their home.And evidence of the spending binge most Americans are still recovering from is evident in even the broadest sense, not just limited to those with more limited financial means. Even the “mass affluent” — those making $100,000+ in income per year, according to the MetLife study — haven’t been saving enough, with more than one-quarter (29 percent) saying that they couldn’t meet their financial obligations for more than one month following a job loss.
That’s the sort of information that should give every lender, investor and servicer pause as we think about managing a growing number of bad loans.
“The American dream is on pause. The majority of Americans still believe they can still achieve the dream in their lifetimes but, for the next year, it’s all about shoring up the foundation of their personal safety nets,” said Beth Hirschhorn, senior vice president for global brand and marketing services at MetLife. “For the one-third of Americans who believe they have already achieved the dream, being able to sustain the dream — without backsliding — is becoming as important as achieving it in the first place.”
Frist
From the WSJ:
Hovnanian’s Loss Widens, Sales Plunge
Hovnanian Enterprises Inc. posted a wider fiscal first-quarter net loss Tuesday on increased write-downs and sharply lower revenue, and said it sees no pickup in the housing market.
Chief Executive Ara Hovnanian also expressed disappointment with the recently passed stimulus bill and the Obama administration’s plan to stem foreclosures, saying neither includes “significant provisions designed to stimulate housing demand.”
“Prospective homebuyers are still faced with making the decision to buy a home against an exceedingly difficult economic backdrop, and we expect demand for all homes, both new and existing, to remain far below normalized levels,” Mr. Hovnanian said in the company’s press release.
For the quarter ended Jan. 31, the family-controlled company reported a net loss of $178.4 million, or $2.29 a share, compared with a year-earlier net loss of $130.9 million, or $2.07 a share. The latest results included $132 million in write-downs on land and other items, compared with $94 million a year earlier.
Revenue tumbled 66% to $373.8 million.
…
The company’s contract backlog as of Jan. 31 was 1,660 homes with a sale value of $531 million, down 61% from a year earlier. The cancellation rate fell to 31% from 38%.
I think it was Gary Shilling who said in his interview on Bloomberg, that by the time this is all over, we will have to bail everybody out.
Good times.
i dont get it….i have been looking for a while out in Morris County and prices are still sky high! are none of these sellers reading any of the news with the housing crash? i see homes on the market for over 200 days….doesnt the seller get a clue that after so many days on the market, there is no one out there to buy your overpriced house?
also, does anyone out there have a listing of the homes sold at the auction last week? posted anywhere? need some new comps!!
Grim,
you blog is broken.
If you don’t post and write what I wanna hear when I wanna hear it, damn you.
damn all you idiot & nuts to hell.
:)
SAS
You gotta let this place rush over you. Just sit back and see where it goes. I have learned a lot….
CAIBC,
how do these home owners sell? a large portion are probably underwater and dont have cash to bring to the table…
as clot has said, a large % of homes on the market arent actually for sell, they are just bag holders looking for another sucker.
Two new home improvement projects just booked with my favorite contractor. Best rate yet for sensible work. He can squeeze us in between a bigger project. Life is good for now!
Not much surprise in these Met Life figures. Median net worth of households excluding home equity is statistically indistinguishable from zero, today and for as long as I can remember.
If I had to sell and write a check I would not. Pure and simple. I would however work out a creative agreement whereas I could provide some ‘services’ for said homeowners wife.
http://www.bondbuyer.com/article.html?id=20090309XQMS02SU
4 CAIBC
“are none of these sellers reading any of the news with the housing crash?”
are the people buying right now reading any news? wtf? I think current buyers are uninformed and think they’re getting a deal of a lifetime.
Speakng of MetLife,
Supposedly an attempted suicide this evening at the MetLife building @ grand central.
bye bye..
“Hedge Funds May Cut 20,000 Jobs as Losses Erode Fees”
http://www.bloomberg.com/apps/news?pid=20601087&sid=a8uLPVL9X8yY&refer=home
“Unemployment: Companies Cut Pricey Older Workers”
http://abcnews.go.com/Business/story?id=7042634&page=1
this is to all the frustrated pant up demand buyers that want that american dream, especially the first timers out there… word.
when we were buying, it was a hard guess “what do we offer?”
… well, when monitoring the market for 2.5 years & watching property values fall, we were able to be there when someone was at their max limit (16% off) & really swoop in… maybe we could’ve gone for more, but we got an entire new roof too.
in 2006 we drank ourselves silly one night pining over the cutest cape in berk.heights, with 2 bedrooms, 1 bath, on .2 acres, with oil, a township easement, on a 35mph road, with a finished but unheated attic, in dire need of a complete reno… it sold in 2006 for what we paid in 2008 for a 3 bed, 2.5 bath, on .8, with gas, wood burning fireplace, unheated sunporch, finished/heated basement, 25mph-no yellow line road.
as tom petty says, the waiting is the hardest part.
there’s more to come frustrated buyers, be patient. Sellers, if you need out, take 3% compound annually if you can & get out!
make a quick glance affordability calculator, stay on the sidelines, & watch the prices come into your sweet spot.
the point of this post is
know your sweet spot
you’ll see some get away, that’s ok… you’ll learn a lot though by seeing how much they truly can fall right into your lap & affordability scale… then wait a bit more cos it’ll get even sweeter. its tough to watch a few go buy, maybe like us you need to go thru one inspection to see the ‘sweet’ one turn sour. it’s $700 lesson that’s worth it.
here’s an example of a quick-glance affordability calculator, one of many great tools you’ll find on this site, in addition to the great can-openers to use in a fall-out shelter. have fun making your own!
http://img.photobucket.com/albums/v89/fucttape/quickglancepic.jpg
Friend explained to me C’s profitability, they’ve hired Madoff’s auditor.
“Government bailout hits $8.5 trillion”
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/11/26/MNVN14C8QR.DTL
The bailout of AIG has gotten bigger, and taxpayers have taken on more risk:
Sept. 16: The government extends AIG a two-year loan of up to $85 billion, and gets a 79.9% stake in return.
Oct. 8: Bailout loans increase to nearly $123 billion due to problems in AIG’s securities-lending program.
Nov. 9: The rescue package increases to $150 billion, including a new $40 billion federal investment.
March 1: The government makes $30 billion in TARP money available and cuts the loans to up to $25 billion.”
It is not clear what the “$40B federal investment” is. The Fed’s website says that the government exchanged its $40B cumulative preferred shares in AIG for new preferred shares that more closely resemble common equity, so it is likely there is no “new” $40B investment. The reduction of the “government” loans to $25B is actually a reduction of the $60B revolving credit facility put up by the Federal Reserve Bank of New York, not the government, so, essentially, the government’s commitment of TARP funds reduces the obligation of FRBNY. The Fed website [http://www.federalreserve.gov/newsevents/press/other/20090302a.htm] discloses that FRBNY holds a lien on a substantial portion of AIG assets as well as preferred stock in two new entities formed to hold all of the stock of two life insurance holding company subsidiaries of AIG (valued at $26B). The lien position means that the FRBNY has a superior position to that of Treasury as equity holder.
A third update on Bloomberg on March 3 reports:
“AIG is getting as much as $30 billion in new government capital and relaxed terms on its bailout announced yesterday.”
In a March 2 article, Reuters reports that the government’s exposure following the new bailout terms is $163B. On March 8, the International Herald Tribune, apparently using Reuters as a source, pegs the exposure at $160B. Other headlines in the first week of March report that Senate leaders grilled regulators about the “$180B AIG Bailout”.
Note: Bloomberg originally reported that the initial line of credit was backed by Treasury, but no other reports on the increased commitments mention a Treasury back-up. One thing is clear: the blurring of the distinctions between the interests of the “government” and of the FRBNY in the press and the failure of the press to give accurate, complete and critical accounts of the AIG bailout terms, including the superior position of FRBNY to that of Treasury, has left the taxpayers largely in the dark.
AIG…
it doesn’t exist.
thats a conpiracy theory for you nut jobs out there.
SAS
On one’s that got away….I liked a Victorian in Boonton once….historic area of town overlooking an old tract of Packard land….didn’t have it together…it sold….I thought…darn! And now….the Packard land is a giant WalMart….what a view.
“Ara Hovnanian also expressed disappointment with the recently passed stimulus bill and the Obama administrations plan to stem foreclosures, saying neither includes significant provisions designed to stimulate housing demand.”
Housing needs a little time in a monestary after a few years of overstimulation.
How many of folks who should know better are focusing on the public’s “desire to buy” instead of their “ability to afford to buy”?
Oh, I get it. Extending credit to those unworthy of receiving it worked so well the first time we should take a break from paying down debt and take on some more debt in order to support the home builders. Sounds like a plan. Yeesh.
“a large % of homes on the market arent actually for sell, they are just bag holders looking for another sucker.”
Bingo.
Essex,
In the end, a view is not worth paying extra for if you don’t own all the land at which you are looking.
Geithner on Charlie Rose right now.
One newbie realty question…
Does it make sense to own a townhouse [newer, better design], or a single family home [older, more space] for roughly the same price. What are the general factors to consider? What sort of ratios of costs of a single family home versus townhouse? There is a lack of consensus in our house…
How long is Jon Stewart going to keep this crap up attacking Cramer? Does Stewart know how to do anything other than be a damn foot soldier for “That One”? This is bullspit. Cramer was on the today show with Erin Burnett, and they tried to embarrass him. He’s done wonderful things and I can’t understand why “That One” wants to silence him.
Again, this just goes to show once again that “That One” is a different kind of liberal and is very vindicative and power hungry. At least with our beloved Dubya, you could speak and not worry about anyone trying to do anything to you. The new regime doesn’t tolerate dissent and is trying to make life hell for Cramer and CNBC. For some reason, they’ve decided to give Larry Kudlow a pass for now.
to the guy who said this site is ‘hurtin’ on the other post …
completely disagree. love the doom and gloom survivalist stuff. i have printed out some of it and started stockpiling.
CNBC has been doing an incredible service to the investing public, but That One wants them off the air. I can’t understand why CNBC would want to even share the damn stage with the likes of Chis Matthews, Keith Olbermann and that damn radical heifer, Rachel Maddow. The producers of CNBC along with all the personalties should just leave and move to Fox where they’d be welcome.
tard (29)-
“Watching CNBC will make you stupid and poor.”
– John Bogle
If you watch CNBC for anything other than the babes and the unintended humor, you deserve to be parted with your coin in short order.
Boo friggin’ yah.
Bloomberg kicks CNBC’s ass in every department.
Plus, their afternoon guys can completely dismantle an interviewee who’s lying or pumping his own position.
“damn radical heifer” – sounds awesome…
Great post Clot.
I don’t understand peoples fascination with the midwestern looking morning blonde.
What recession? 72% of us can go more then 2 weeks without a paycheck.
/off Frank
Safe 35 It is going to get real ugly real quick if those numbers are accurate.
Not to worry. O is going to save us! Or maybe Ophra will save us by buying us all new cars! Yes!
With UP benefits lasting 14 monthes plus many with severance it will hit the fan just long & drawn out. Looking for all is fine in 2010 think again. That is when it will really get bad.
Next springs RE season will make this one look good.
#36 Mike,
Unemployment will let the sheeple bury themselves deeper in debt at they muddle along. How many people can get by on 2/3s or less of their income, and what if someone gets injured or seriously sick? BK time.
Many people are about to discover they are not middle class, they had middle class income but had assets like the poor. That is none to negative net worth.
More murder and mayhem
http://www.cnn.com/2009/CRIME/03/11/alabama.shooting.spree/index.html
Sweet home Alabama. I guess it is not just postal workers anymore.
It is a horrific story, unfortunately I think we will see more of this as things deteirate.
CAIBC:
Most people in parts of Morris county have a sense of disconnect to reality anyway. They live in bigger homes and have made more money in the past. That being said, reality has a way of slapping us all in the face when we least expect it.
I spoke to a friend this morning who works for Morgan Stanley. He said that they are estimating that 60% of hedge funds will close by the end of this year. Many who have already been let go have received 6 months severance that they are planning to live off of until the stock market and housing market come back. These peopel actually believe that Sept 2009 will be “back to normal”. He says once again these people are not dealing in reality. Those people live in the train towns: Summit, Chatham, Madison, Convent Station, Peapack-Gladstone etc. He predicts October as a free for all in people selling, even if they are under water.